Buy Mastek; target of Rs 3610: Sharekhan

Sharekhan's research report on Mastek

Reported revenues stood at $103.6 million, up 4.7% q-o-q/10.2% y-o-y in constant currency (CC) terms, beating our estimates of $101.5 million. EBITDA margin rose by ~125 bps q-o-q to 16.5%, beating our estimates of 16%. The company aims to operate EBITDA margins in the range of 17% to 17% plus. Company is confident of absorbing full impact of wage hike in Q3 through multiple margin levers and report good margin performance in Q3 and Q4.

Outlook

We maintain a Buy with revised price target (PT) of Rs. 3,610 (valued at 25xSep26E EPS). At CMP, the stock trades at 25.9/22.2/18.8x its FY25/26/27E EPS.

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Mastek - 21102024 -khan