Results to watch out – Mindtree, ACC, Mastek@HighLight Updates
The results that are expected today include Mindtree, ACC, Mastek and HDFC Standard Life Insurance.
Here is the street expectation for the companies:
Mindtree Q4 FY18 (QoQ):
Here is the street expectation for the companies:
Mindtree Q4 FY18 (QoQ):
- PAT may increase by 17.7% to Rs166.5cr.
- Net sales likely to grow by 4.4% to Rs1,438.5cr.
- EBITDA likely to rise 10.6% to Rs 229.3cr.
The stock is currently trading at Rs881 down by Rs2.4 or 0.27% from its previous closing of Rs883.40 on the BSE. The scrip opened at Rs885 and has touched a high and low of Rs895.30 and Rs879 respectively.
Mindtree is a midsized IT services company offering major services like application development and maintenance, infrastructure management and independent testing amongst others. Mindtree has recently restructured the organisation by verticals – (1) Technology, Media & Services (~37% of revenue, 3QFY18), (2) BFSI (25%), (3) Retail, CPG & Manufacturing (23%) and (4) Travel & Hospitality (15%).
We believe that the phase of weak growth rate for Mindtree owing to the weakness in top client account has likely bottomed out. We are optimistic about stability returning in top client account and believe that likelihood of further price cuts is low. Growing share of digital on the back of new deal wins and higher contract size would drive revenue CAGR of 9% over FY17-20E. Turnaround in acquisitions (Bluefin and Magnet360), pyramid corrections, favourable realisations and site mix would act as margin levers (184bps expansion to 15.5% over FY17-20E). Consequently, we expect PAT CAGR of 21% over FY17-20E. However, Mindtree is trading at 19x its FY20E EPS, which limits upside in the stock.
ACC Ltd is currently trading at Rs1,590.50 up by Rs5.9 or 0.37% from its previous closing of Rs1,584.60 on the BSE. The scrip opened at Rs1,600 and has touched a high and low of Rs1,601 and Rs1,587.45 respectively.
ACC, with 32mtpa capacity, has a balanced regional volume mix across India with North and Central contributing 23% each (South - 21%, East - 20% and West - 13%). Company is taking efforts towards cost efficiencies through phasing out of old plants and increasing captive power plant capacity in order to improve its EBITDA margin. Further, though the merger of ACC-Ambuja Cements has been put on hold, they have entered into a Master Supply Agreement (MSA) to optimise synergies.
Mindtree is a midsized IT services company offering major services like application development and maintenance, infrastructure management and independent testing amongst others. Mindtree has recently restructured the organisation by verticals – (1) Technology, Media & Services (~37% of revenue, 3QFY18), (2) BFSI (25%), (3) Retail, CPG & Manufacturing (23%) and (4) Travel & Hospitality (15%).
We believe that the phase of weak growth rate for Mindtree owing to the weakness in top client account has likely bottomed out. We are optimistic about stability returning in top client account and believe that likelihood of further price cuts is low. Growing share of digital on the back of new deal wins and higher contract size would drive revenue CAGR of 9% over FY17-20E. Turnaround in acquisitions (Bluefin and Magnet360), pyramid corrections, favourable realisations and site mix would act as margin levers (184bps expansion to 15.5% over FY17-20E). Consequently, we expect PAT CAGR of 21% over FY17-20E. However, Mindtree is trading at 19x its FY20E EPS, which limits upside in the stock.
ACC Ltd is currently trading at Rs1,590.50 up by Rs5.9 or 0.37% from its previous closing of Rs1,584.60 on the BSE. The scrip opened at Rs1,600 and has touched a high and low of Rs1,601 and Rs1,587.45 respectively.
ACC, with 32mtpa capacity, has a balanced regional volume mix across India with North and Central contributing 23% each (South - 21%, East - 20% and West - 13%). Company is taking efforts towards cost efficiencies through phasing out of old plants and increasing captive power plant capacity in order to improve its EBITDA margin. Further, though the merger of ACC-Ambuja Cements has been put on hold, they have entered into a Master Supply Agreement (MSA) to optimise synergies.
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