Arihant Capital has given Buy recommendation for Birlasoft with a target price of Rs. 550 in its research report issued on Jan 28, 2022
Arihant Capital’s research report on Birlasoft
Consolidated revenue stood at INR 10,719Mn, against Q3FY21 of INR 8808 Mn registering a growth of 6% QoQ/21.7% YoY • EBITDA stood at INR 1,628 Mn, against Q3FY21 of INR 1,444 Mn, Registering growth of 7.2%QoQ/12.7%YoY. On the margins front, EBITDA margin contracted by 122bps YoY/+18 QoQ to 15.2%, against Q3FY21 of 16.4%. Consolidated PAT saw a growth of 18.2%YoY/+10.5% QoQ to INR 1140 Mn against Q3FY21 of INR 964 Mn. EPS stood at INR 4.1 in Q3FY22 against INR 3.5 in Q3FY21 (INR 3.7in Q2FY22). Signed deals of TCV $ 182 M during the quarter and New deal TCV wins of $ 121 M in Q2. Active Client Count at 285. $ 5 M customer at 21; up by 1 QoQ o Top 10 & Top 20 customers grew 21.4% & 22.9% YoY, respectively • The company headcount stood at 11,945 as of December 31, 2021, and added 1,546 professionals on a YoY basis.
We value Birlasoft at a PE of 26x to its FY24E EPS of INR 21.7, which yields a target price of INR 550 per share. Accordingly, we recommend a BUY rating on the shares of Birlasoft.