This multibagger IT stock zoomed over 130% in one year; more upside likely

 Shares of Mindtree Limited have delivered more than 100 per cent return to its shareholders in the last 12 months. In the last one year, Mindtree Limited share price jumped from Rs 1,604.85 to Rs 3,785.65 mark - logging around 136 per cent return in this period.
 
An amount of Rs 5 lakh invested in this multibagger stock a year ago would have turned into Rs 11.8 lakh today.
With a market capitalisation of more than Rs 61,000 crore, the shares stand higher than 200 day moving averages but lower than 5 day, 20 day, 50 day and 100 day moving averages.
 
The stock rose 6 per cent to hit an intraday high of Rs 3,785.65 on BSE on Friday. It hit a 52-week high of Rs 5,059 on November 18,2021 and a 52 week low of Rs 1,550.95 on February 26, 2021.
 
Brokerage house Motilal Oswal said that the company reiterated its 4x4x4 strategy (four industry groups, four service lines, and four geographies). It continues to see opportunities across industries and services. Including the evolving Healthcare vertical as the fifth industry unit, MTCL is seeing an increased trend of clients operating across industry lines and sees convergence as a key theme going forward.
 
"We continue to see strong topline growth, driven by its actions and overall demand strength. With its focus on stable margin, we expect margin in FY23 to moderate slightly, limiting gains from operating leverage to earnings," it added.
 
"The stock is currently trading at 27x FY24E EPS. With a strong performance in the last one-year, the key positives are already captured in the valuation. We see limited upside hereafter. Our target price stands at Rs 4,050 per share, implying 29x FY24E EPS. We maintain our Neutral rating," the brokerage house said in its report.
 
Dolat Capital noted that given the 20 per cent correction in stock since Q3 results, the stock is now trading at an attractive valuation of 30x on FY24 EPS and thus the brokerage house upgraded the stock from 'Sell' to 'Accumulate' Rating with target price of Rs 4,360.
 
"Going forward, Mindtree will be key beneficiary of strong growth in digital technologies and larger tech spending pie over 2-3 years. However, most of the positives are factored and hence we maintain 'Hold' rating with target price of Rs 4,150," noted IDBI Capital.
 
For FY23, the company will focus on being full stack player, build ecosystem around cloud players, shift to digital platform, enable industry convergence and invest in next generation capabilities.
 
The IT services company posted a 34 per cent rise in consolidated net profit at Rs 437 crore for the quarter ended December 2021 against Rs 326 crore logged in the same period last year. Revenue from operations rose 35.89 per cent to Rs 2,750 crore against Rs 2,023 crore in the same period last year.