Hold Mindtree, target price Rs 1530: Axis Securities

Axis Securities has given a hold rating to Mindtree with a target price of Rs 1530. The share price moved up by 0.35 per cent from its previous close of Rs 1331.20. The stock’s last traded price is Rs 1335.80.

MindTree Ltd., incorporated in the year 1999, is a Mid Cap company (having a market cap of Rs 21538.04 Crore) operating in IT Software sector.

Financials
For the quarter ended 30-09-2020, the company reported a Consolidated sales of Rs 1926.00 Crore, up .90 % from last quarter Sales of Rs 1908.80 Crore and up .61 % from last year same quarter Sales of Rs 1914.30 Crore Company reported net profit after tax of Rs 253.70 Crore in latest quarter.

Investment Rationale
The brokerage believes Mindtree has a resilient business structure from a long term perspective and multiple long term contracts with world’s leading brands. With depreciation in INR, lower travel cost, lower on site expenses EBITDA margins likely to expand in near term. It recommends HOLD and assign 21x P/E multiple to its FY23E earnings of Rs. 74 per share which gives a TP of Rs. 1,530 per share, an upside of 7%.

Promoter/FII Holdings
Promoters held 67.6 per cent stake in the company as of Sept 30, 2020, while FIIs held 12.02 per cent, DIIs 8.96 per cent and public and others 11.43 per cent