Zensar Technologies Ltd. share price target

We resume our coverage with a HOLD rating on the stock.

Zensar delivered a strong Q1FY26 performance despite macroeconomic headwinds, reporting revenue of USD 162mn (up 3.3% QoQ), with AI contributing 30% to the active pipeline and 20% to order bookings. Over 50% of its workforce is now trained in AI/GenAI. Growth was led by TMT, BFSI, and healthcare, while manufacturing and consumer services declined slightly. EBITDA stood at 15.2%, down 40 bps due to higher sales and travel costs, while gross profit improved to 30.5%. Order bookings rose 11.7% YoY to USD 172mn, with employee utilization at 84.3%, up 40 bps YoY. The company launched Zen's AI platform, which received...

ZENT reported a decent 4QFY25, with revenue growth of 0.9% QoQ CC (est. decline 0.5% CC). BFSI/TMT grew 3.4%/1.7% QoQ CC, while HLS and Manufacturing declined 1.4%/2.6% QoQ CC.

Delivered better-than-expected revenue and margin. After a mid-single digit FY25, revenue growth in double digits in FY26 likely

ZENT reported a decent 3QFY25, with revenue growth of 0.7% QoQ CC (est. flat growth), driven by Manufacturing & Consumer services (up 6.5% QoQ CC) and Healthcare & Lifesciences (up 3.2% QoQ CC).

We maintain our HOLD recommendation on the stock.

Weak QoQ growth due to client specific issues in TMT vertical whereas BFSI and HLS show good traction.

We maintain our recommendation to HOLD the stock

ZENT reported a strong 1QFY25, with revenue growth of 4.3% QoQ in CC (est. 1.9%) driven by sequential growth across all verticals. Deal TCV came in at USD154m (-15% QoQ/flat YoY).

We recommend a HOLD rating on the stock and assign a 24x P/E multiple to its FY26E earnings of Rs 29.8/share to arrive at a TP of Rs 710/share. The TP implies an upside of 6% from the CMP.

The company's promising recovery prospects bolstered by favourable business deals and enhanced customer retention, we maintain our recommendation to HOLD the stock.

Recommendation: The demand scenario in the majority of the verticals remains sceptical, which will impact revenue growth momentum in the near term. Given the company's strong recovery potential, supported by good business deals and improved customer retention, we maintain our HOLD recommendation

The demand scenario from the majority of the verticals remains sceptical, which will impact revenue growth momentum in the near term. Given the company's strong recovery potential, supported by good business deals and improved customer retention, we maintain our HOLD recommendation