Birlasoft Ltd. share price target

ecosystem. The company's consultative and design thinking approach makes societies more productive by helping customers run businesses. Birlasoft offers IT services worldwide from development centers in India and Australia. BSOFT and KPIT's IT services business has merged to form a leading publicly listed Enterprise...

Background: KPIT Technologies is leading is a global technology company providing software solutions that help mobility companies leapfrog towards autonomous, clean, smart and connected future. The major focus areas of the company are power train (Conventional and electrical), autonomous technology (vision and control systems), connectivity and diagnostics. The company's focus sub verticals are Passenger cars, Commercial and Off-highway vehicles and New Mobility. KPIT derives 84.6% of its revenue from strategic top 21 clients. The company has 6,732 employees to cater services to 55 clients. The company's business is spread across America (41%), Europe (39%), and Row (20%)....

What should investors do? Birlasoft's share price has grown by ~3.5x since it demerger (from ~| 114 in February 2019 to ~| 406 levels in October 2021). Target Price and Valuation: We value Birlasoft at | 475 i.e. 23x P/E on FY23E EPS....

ecosystem. The company's consultative and design thinking approach makes societies more productive by helping customers run businesses. Birlasoft offers IT services worldwide from development centers in India and Australia. BSOFT and KPIT's IT services business has merged to form a leading publicly listed Enterprise...

We continue to remain positive and retain our BUY rating on the stock Target Price and Valuation: We value Birlasoft at | 475 i.e. 25x P/E on FY23E EPS Key triggers for future price performance: Revenue growth is expected to be achieved via client mining, cross sell,...

Improving client mining, healthy deal pipeline, cross selling opportunities, increase in deal sizes, project ramp ups, reversal of discounts and anticipated higher net new growth bode well for long term revenue growth. Further, robust margins and healthy cash balance (inorganic expansion or healthy dividend payout) prompt us to maintain BUY rating with a revised...

Sustained improvement in margins expected; going forward Birlasoft reported healthy margins in the quarter led by higher utilisation and offshoring. Going forward, we expect margins to improve mainly led by pyramid rationalisation, rationalisation of support staff & sub-contracting cost and increase in annuity revenues & fixed price projects partially offset by investment in reskilling of employees & geographic expansion. Hence, we expect margins to improve 259 bps YoY to 14.5% in FY21E and another 130 bps YoY to 15.8% (the company has guided margins to sustain over...

Birlasoft Ltd (Birlasoft) dollar revenues declined 4.6% QoQ mainly due to milestone achievement in large deal won in lifescience segment (which declined 20.5% QoQ), discounts and project deferrals. However, the company continues to execute well on margins front, which improved 158 bps QoQ (up 288 bps YoY) to 13.9% mainly led by rationalisation of SG&A; expenses and higher utilisation partially offset by higher onsite revenues. Net profit increased 22.7% QoQ to | 69.1 crore due to higher other income. The company has declared a dividend of | 1/share. Birlasoft's order book is...

Revenue from operations declined 1.6% QoQ to | 1061.3 crore (vs. our estimate of | 1092.6 crore). Revenues from IT services and solutions declined 6.6% QoQ to | 563.6 crore while revenue from the Engineering division grew 4.7% QoQ to | 497.6 crore Reported EBITDA was down 208 bps QoQ to 11.5%, largely due to...