Q4FY21 Company Update - Mastek Ltd - ICICI Direct

Mastek's dollar revenues increased 7.5% QoQ (in CC terms) and by 9.7% QoQ (in reported terms) to US$65.9 million. The increase in revenues was led by Evosys acquisition and strong growth in UK government business. EBIT margin declined 100 bps QoQ to 19.8% mainly due to wage hike and investment in leadership & sales. Mastek's 12-month order book rose 19.3% QoQ to US$154.6 million. Mastek has declared a dividend of Rs. 9/share.

Valuation & Outlook

The company is seeing healthy improvement in order book, increase in deal size and traction in multi-year deals. In addition, healthy growth in UK government, focus on improving US geography, client mining, traction in digital technologies, inorganic expansion and market share gains are expected to drive the company's long term growth. Hence, we upgrade the stock from HOLD to BUY with a revised target price of Rs. 1900 (18x FY23E EPS) (earlier TP Rs. 1310).

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Mastek_CoUpdate_Apr21.pdf

Shares of MASTEK LTD. was last trading in BSE at Rs.1644.25 as compared to the previous close of Rs. 1625.35. The total number of shares traded during the day was 39408 in over 2942 trades.

The stock hit an intraday high of Rs. 1698 and intraday low of 1605. The net turnover during the day was Rs. 65256646.

Source : Equity Bulls

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