MindTree Ltd. share price target

Mindtree (MTCL) reported growth of 4.7% QoQ USD, in-line with estimates. Momentum was driven by travel, CMT and BFSI

Mindtree is a technology consulting and digital solutions company.

Management mentioned that demand environment continues to remain strong and expects industry-leading growth in FY22. Management also guided that EBITDA Margins to sustain over 20% in FY22 despite increasing attrition and supply side challenges....

We remain cautious on the stock, as the valuation looks expensive at current levels. The company has already breached the rebound levels from the low economic activity last year. Hence, we maintain our HOLD...

Strong Q2 beat led by significant revenue surprise and resilient operating margin

MTCL delivered another excellent quarter, with a revenue of USD350m (+12.8% QoQ, est. 8.3%), driven by broad based growth across verticals and regions. The only pocket of weakness in 2QFY22 was in its top client (flat QoQ), which now accounts for 24% of revenue (exposure down by ~600bp v/s the peak in 1QFY21). Deal TCV stood at USD360m (-29% QoQ/+19% YoY), with a good mix of annuity and transformational deals. EBITDA margin rose 20bp sequentially, despite the impact from a wage hike. Margin in 2QFY22 was aided by operating leverage and currency...

Background: Mindtree is a global technology consulting and services company, helping enterprises marry scale with agility to achieve competitive advantage. Born digital, in 1999 and now a Larsen & Toubro Group Company, Mindtree applies its deep domain knowledge to 290+ enterprise client engagements to break down silos, make sense of digital complexity and bring new initiatives to market faster. We enable IT to move at the speed of business, leveraging emerging technologies and the efficiencies of Continuous Delivery to spur business innovation. Operating in more than 15 countries across the world, we're consistently regarded as one of...

MTCL reported exceptionally strong beat in revenue (+450bps/+680bps above our/cons estimates) with 12.7% QoQ USD growth led by strong growth in RCM (+29.7% QoQ USD) partly aided by project backlogs as economies opened after extended lock down, especially in Europe region which also posted...

We recommend a BUY on the stock and assign 38x P/E multiple to its FY24E earnings of Rs 129.3/share to arrive at a TP of Rs 4880/share, implying an upside potential of 12% from CMP.

We recommend a BUY rating on the stock and assign a 36x P/E multiple to its FY24E earnings of Rs 128.3/share to arrive at a TP of Rs 4600/share, implying an upside of 12% from CMP.