For updates visit
Buy HCL Tech; target of Rs 373: IL&FS
Thursday, April 19, 2007
Results in line, maintain ‘Buy’
HCL Technologies (HCL Tech) Q3FY07 results were in line with our estimates; the company’s revenue and net profit registered a sequential increase of 7.6% and 15.8% to Rs 15.77 billion and Rs 3.3 billion respectively. In continuing with its strategy of focusing on large deals, the company signed six large multi-year deals exceeding USD 25 million.
The company also signed six multi-year deals exceeding USD 50 million in the last few quarters, which have contributed more than 10% to the company’s Q3FY07 revenue.
We are reducing our FY07E and FY08E EPS estimates by 3.3% and 5.1% to Rs 15.2 and Rs 18.6 respectively; to take into account rupee appreciation and equity dilution due to ESOPs. We further estimate the company to report an EPS of Rs 23.0 in FY09E, implying a two-year EPS CAGR of 22.9%. Currently, the stock is quoting at FY08E and FY09E PER (based on post ESOP charged EPS) of 16.2x and 13.1x respectively. We maintain ‘Buy’ rating on the stock; we have set a one-year price target of Rs 373 on rolling PER basis.
0 comments:
Subscribe to:
Post Comments (Atom)
IMPORTANT DISCLAIMER
Investment in equity shares has its own risks. Sincere efforts have been made to present the right investment perspective.The information contained herein is based on analysis and up on sources that we consider reliable. I, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and I am not responsible for any loss incurred based upon it.& take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations given in this blog.
