EUR 120.00 For Business Accounts Only

MOSL: Morning India (30/July/21): 1. Tech Mahindra (Improving outlook, but operational metrics stretched); 2. India Strategy (Ownership analysis); 3. Indus Towers; 4. Colgate-Palmoliv; 5. SRF; 6. Biocon

MOrning India (30/July/21): 1. Tech Mahindra (Improving outlook, but operational metrics stretched); 2. India Strategy (Ownership analysis); 3. Indus Towers; 4. Colgate-Palmoliv; 5. SRF; 6. Biocon

 

Today’s top research idea

Tech Mahindra: Improving outlook, but operational metrics stretched

• In USD terms, revenue growth of 3.9% QoQ CC in 1QFY22 was above our estimate mainly on account of Communications.
• EBIT margin dipped by 130bp QoQ in 1QFY22 (led by wage hike, visa cost and seasonality in Communications), but was 90bp above our estimate.
• With healthy deal bookings and highest ever pipeline, we expect TECHM to deliver revenue growth of 13% in FY22, although it will still be the weakest among our largecap coverage universe.
• We continue to stay on the sidelines on TECHM as we see its stronger business performance as balanced by elevated operational metrics in a supply constrained environment. Our TP implies 17x FY23E EPS. We remain Neutral on the stock.

 

Piping hot news

Cabinet Clears amendments for privatisation of general insurance firm

The cabinet has approved amendment to the General Insurance Business (Nationalisation) Act, 1972 paving way for privatisation of one state-run general insurer. "The cabinet approval has come. Now the bill may be presented in this session of the Parliament," said a government official adding that the amendments seek to allow bring down government holding to below 51% and transfer of management control to private player in case of shortlisted firm. In her budget speech this year finance minister Nirmala Sitharaman had said that the government will take up two public sector banks and one general insurance company for privatisation in FY22.