Stock To Sell, Rs 55 Dividend In Q4: ICICI Securities Reiterates SELL For Mid-Cap IT Stock, TP Rs 1950

ICICI Securities has recommended sell call to mid-cap IT Services firm Mphasis Ltd share with target price of Rs 1950 per share. Current market price of Mphasis share on BSE is Rs 2293.35 per share with intraday fall of 1.08% as on May 3, 2024. Mphasis declared an attractive dividend of Rs 55 per share on April 25, 2024. Mphasis share declined 16% year-to-date and witnessed rally of 24% in last 1-year. More details below:

Mphasis Declares Dividend: As per the BSE filing of Mphasis dated April 25, 2024, "Recommendation of dividend of Rs 55 /- per equity share of Rs 10/- each for the year ended 31 March 2024, which is subject to approval of the shareholders at the ensuing Annual General Meeting. The dividend, if declared at the ensuing Annual General Meeting of the Company, will be paid within 30 days of the Annual General Meeting, to those shareholders, whose bank account details are registered with the respective Depository participant(s) or with the Registrar and Share Transfer Agent of the Company."

Mphasis Share Performance & Return: The 52-week high price of Mphasis share on BSE is Rs 2,835.00 apiece (as on 19/02/2024) and 52-week low price is Rs 1807.00 (as on 26/06/2023). The company has a market capitalisation of Rs 43,344.43 crore. Mphasis Ltd share fell 7.62% in last 1-mont, declined 16% year-to-date, offered return of 4% in last 6-months, and gained 24% in last 1-year. In last 5-years, Mphasis shares zoomed 136%.

Mphasis Q4 Results: The IT Software company for the quarter ended March 2024 declared a decline of 2.9% in net profit at Rs 393.22 crore as compared to Rs 405.31 crore declared in the corresponding quarter of last year. The decline in the profit occurred due to 10% YoY degrowth in the banking, financial services (BFS) segment which forms almost half of its revenues. The company also recorded a 10.8% YoY decline in its top 1-10 client metrics as result of BFS related decline in initial part of the year, according to the BSE filing. Sequentially, profit zoomed 5.2% from Rs 373.6 crore in the preceding quarter ending December 2023.

ICICI Securities Recommends Sell Call: The analyst said, "We see risk from Mphasis' interest rate sensitive mortgage business. Company's margin guidance for FY25 was also subpar at 14.6%-16%. Factoring in new guidance, we adjust our FY25E/26E EPS by -4.1%/1.9%, factoring in the guided margin. We continue to value the stock on 18x FY26E EPS of INR 106, and arrive at a revised TP of INR 1,950. Reiterate SELL."

About: Mphasis' purpose is to be the "Driver in Driverless Car" for Global Enterprises by applying next-generation design, architecture and engineering services, to deliver scalable and sustainable software and technology solutions. Mphasis' core reference architectures and tools, speed and innovation with domain expertise and specialization , combined with an integrated sustainability and purpose-led approach across its operations and solutions are key to building strong relationships with marquee clients, according to its official website.

Disclaimer: The stock has been picked from the brokerage report of ICICI Securities. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.