Zensar Technologies - Persistent Growth - Sunidhi

Zensar Technologies Limited (ZTL) is confident that infrastructure management will do well despite all the talks of the European crisis and the impact it could have on clients' IT budgets. By 2015, Zensar expects infrastructure management business to scale up to US$400 million by leveraging capabilities of US-based Akibia.

ZTL is well placed to tap potential in the SMB sector and new verticals (Healthcare, Utilities, Transportation), with their experience in emerging markets, mature service capabilities, global footprint and talent pool. Suitably exploiting these emerging opportunities both in the global and domestic markets can help ZTL to enhance its revenue substantially in 3 years.

According to the IT industry, Infrastructure Management Solutions (IMS) is a $370 billion market, split into Data Centre services ($231billion), Remote Infrastructure Management ($108 billion) and Managed Services ($31billion).

ZTL is undertaking a major business transformation by moving into new areas of IT outsourcing services and rejigging operations with a view to scale its revenue to $1billion (Rs.5, 400 crore) by 2016.

At the CMP of Rs.275, the share is trading at a P/E of 6.0 on FY13 earnings. We recommend BUY with a target price of Rs.330 in the medium term.

Source : Equity Bulls

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