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Date of Results: 1St November, 2022
Recommendation: Buy.
Target price: Rs 1,130
Recommendation: Buy.
Target price: Rs 1,130
Analysts at IIFL Securities forecast a 2.8% sequential growth in constant currency (cc) revenue (+2.6% cc organic sequential growth) as strength in the telecom vertical offset some softness in the enterprise vertical. Is. Deal wins should remain healthy in Q2, albeit down on a sequential basis.
They expect margins to expand by 40 basis points sequentially as the impact of wage increases is offset by one-time reductions like visa costs and productivity.
The company’s profit after tax (PAT) may grow by 2.5% on a sequential basis.
Key management insights to keep in mind:
- Deal wins, including a ring on the 5G deal
- Revenue and Margin Outlook for H2FY23
- Comments on capital distributions and mergers of acquisitions.
- Supply-side comments on withdrawal trends, subcontracting costs and employee growth
|
Estimated September 2022 |
QoQ change |
YoY change |
|
| Revenue (US$mn) | 1,641 | 0.5% | 11.5% |
| Revenue (Rs. Million) | 130,985 | 3.1% | 20.4% |
| EBIT (Rs. Million) | 15,012 | 7.0% | (9.1)% |
| EBIT margin | 11.5% | 40 bps | (370) bps |
| Profit After Tax (Rs Million) | 11,598 | 2.5% | (13.4)% |
| EPS (Rs.) | 13.1 | 2.5% | (13.5)% |
Source: IIFL Research
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