MOSL: HEXAWARE (Neutral)-Acquires US-based digital consulting firm Mobiquity
HEXAWARE: Acquires US-based digital consulting firm Mobiquity
(HEXW IN, Mkt Cap USD1.5b, CMP INR345, TP INR370, 7% Upside, Neutral)
In this note, we present the key highlights of Hexaware’s (HEXW) acquisition of Mobiquity, our thoughts on this deal and particulars about our estimate changes.
About Mobiquity
- Mobiquity is one of the largest independent customer experience consulting firms specializing in creating frictionless multi-channel digital experiences leveraging cloud technologies.
- Its CY18 revenue stood at USD70m, which grew at a three-year CAGR of ~24%. With a gross margin of ~40% and EBITDA in low teens (slightly less than HEXW), the company is profitable and in a high-growth phase.
- CEO John Castleman, who joined 3.5 years back, is credited to have rapidly grown the company through large client relationships. The company has a sticky client base of large companies, including Amazon, AWS, Rabobank, Philips, Wawa and Backbase.
- Mobiquity employs 700+ people, with core design and strategy team strength of 60. Its offshore base of 200 employees is in India (Ahmedabad and Pune). Attrition is currently at 17-18% level.
Hexaware is a global provider of IT and Process outsourcing services. Co. focuses on maximizing client returns from outsourcing and off-shoring. Co. manages IT applications in real time as well as providing high value services around packaged enterprise applications such as SAP and PeopleSoft. Co. maintains operations in business process outsourcing arena. Co.'s solutions aim to provide value by optimising cost of ownership of technology investments for customers. Co. maintains a client base comprising several Global 1000 organizations. Co.'s global operations are located in North America, Europe and Asia Pacific.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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