Firstsource Solutions Ltd. share price target

FSL is a domain driven BPM company, which has 150+ clients, including 17 Fortune 500 companies and nine FTSE 100 companies. The company has 27,398 employees across the US, UK, India and Philippines...

Improvement in provider, collection segment, diversification in CMT segment, new logo wins, focus on client mining cross selling of platforms business and hiring of leaders bodes well for long term revenue growth The company closed one large deal recently with a health insurance company, under which the company will replace with modern integrated software and services solutions The company faces high attrition, especially on the onshore side. Controlling the same can boost its financials...

The company's robust growth guidance of 15-18% in CC terms is based on improvement in healthcare (especially provider business) and improvement in banking (led by growth in collection & fintech and UK banking). In addition, FSL expects communication, media & technology to gain traction led by improvement in top client and addition of new logos in US & UK in media & e-commerce. The company expects moderation in growth in mortgage (post a robust year) mainly led by slowdown in refinance. Further, we expect the healthcare segment to witness improved traction led by acquisition of...

The company has seen an improved market share in top client. We expect this trend to continue, going forward. Apart from traction in top client, healthy growth in media & e-commerce (added one US ecommerce client in the current quarter) will drive CMT revenues. This, coupled with improving UK BFS and mortgage business (led by refinancing, new home sales & delinquencies) is expected to drive the BFS business. Further, we expect the healthcare segment to witness improved traction led by acquisition of PatientMatters (cross sell opportunities), ramp of large deal win (US$22...

The current quarter growth was driven by healthy growth in top client and banking, mainly led by the mortgage business. Going forward, the company expects top client contribution to reach pre-Covid levels by the next two quarters (from current 16.2% to at least 20.3% by Q4FY21E). In addition, FSL has seen healthy client wins (~15) in the quarter of which nine were in banking (especially mortgage). This, coupled with healthy wins in the previous quarter, improving UK BFS and ramp up of existing clients will drive mortgage business. A key driver of mortgage business (as per FSL) is...

Results beat; Guidance and Commentary gives comfort Firstsource (FSL) reported above expectation results, with a sequential revenue de-growth of 4.3% in CC terms (DART estm: 6.0% decline) due to positive surprise in BFSI Vertical (up 13.9% QoQ in $ terms) and OPM improvement of about 20bps...

The current quarter was impacted by lower volumes from top client. However, FSL expects contribution of top client to gradually improve from 13.7% of topline in Q1FY21 to 20.3% in Q4FY21E. Also, the company is seeing traction in its mortgage business (led by new home sales and may see better growth if delinquencies increases) and improvement in healthcare business. Further, six new logo wins in BFS, new logo win in media & communication, traction in UK retail & BFS and improvement in payer business is expected to drive revenues. In addition, FSL's strategy of...

Amongst the recent launches, partnerships & deal wins, it has launched pioneering platform-based service for Post- Closing' operations for a top mortgage lender an anchor client. In addition has signed on one of the world's leading card issuers for Digital Collections offering. In the Retail and Commercial banking arena, FSL is strategically partnering with top UK-based banks, enabling them to rapidly adapt to changing consumer preferences. More recently, have been playing a key role in...

During FY20 Vipul Khanna was appointed as CEO, prior to joining FSL, Vipul was the Executive Vice President & Global Head of Cognizant Digital Operations. CEO in his first address highlighted the strategic initiatives taken by the organization of ratcheting up investments in sales (Got-to-market; new capabilities), account management (business adjacencies) and solution development capabilities across sectors (Utilities and Technology Content Management) to further consolidate company's market position. This includes its newly launched Digitally empowered...