Q3FY21 Result Update - Team Lease - ICICI Direct

TeamLease Services' (TLS) revenues increased 13% QoQ mainly led by 14% QoQ increase in General staffing, 2.6% QoQ increase in specialised staffing and 30.3% QoQ increase in other HR services. EBITDA margins fell 9 bps QoQ to 1.9% in Q3FY21. General staffing core to associate ratio also improved from 300 to 334.

Valuation & Outlook

The company is expected to be a key beneficiary of formalisation of economy. This coupled with increase in outsourcing, consolidation of market and market share gains are other long term revenue drivers for the company. In addition, we expect specialised staffing revenues to improve led by a revival in IT services and reducing competitive intensity. Further, improving cashflows and margins are other key positives. Hence, we maintain our BUY rating on the stock with a revised target price of Rs. 3290 (35x PE FY23E EPS) (earlier target price was Rs. 2840).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_TeamLease_Q3FY21.pdf

Shares of TeamLease Services Ltd was last trading in BSE at Rs.2831.45 as compared to the previous close of Rs. 2769.6. The total number of shares traded during the day was 3206 in over 682 trades.

The stock hit an intraday high of Rs. 2864.45 and intraday low of 2697.45. The net turnover during the day was Rs. 8965649.

Source : Equity Bulls

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