Buy Mastek; target of Rs 3235 Sharekhan

Sharekhan is bullish on Mastek has recommended buy rating on the stock with a target price of Rs 3235 in its research report dated December 26, 2023.

Broker Research

December 27, 2023 / 16:57 IST

Buy

26 Aug, 2025 12:21

Volume

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Sharekhan's research report on Mastek

The company expects the US geography, Data & automation, AI service line and the Healthcare vertical to grow above the company’s average growth, with the growth in US geography and Data & Automation service line expected to be driven by organic growth, account mining, and BizAnalytica, while growth in Healthcare vertical is expected to be driven by improvement in NHS, pipeline deals, and new opportunities. Opportunities due to policy changes, greater Cloud adoption by UK public sector departments and participation in emerging frameworks would further boost the core UK public sector that is already witnessing strong order booking. EBITDA margin is likely to gradually recover to 17-19% in the coming quarters on push from US growth, improving BizAnalytica margins, and implementation of various measures to aid margin recovery.

Outlook

We maintain Buy with revised price target (PT) of Rs 3,235 (increase in PT reflects increase in target multiple to22x) owing to possible improvement in NHS, strong order booking in the resilient UK public sector, coupled with strong US growth profile and account mining efforts which will offer stronger revenue visibility for FY25 and aid in industry leading growth in addition to recovery in margin profile. At the CMP the stock trades at 23.8/18.8x its FY25/26E EPS.

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