Review

MPHASIS

CMP: Rs. 970.55
Rec. Price Rs. 991 
Ticker : 526299 
FV: Rs. 10 
52-Week H/L: Rs. 1278/855



We had recommended Mphasis in volume no. 35, issue no. 15 (dated Feb 04, 2019), when the scrip was trading at Rs 991 Our recommendation was backed by factors like strong performance and the likelihood of improvement in the core business. In Q3FY19, the company posted strong performance with growth in revenue by 12 per cent YoY and profit by 29 per cent YoY. Strong growth in core business and DXC/HP business was offset by a slowdown in the digital risk business. The company management remains confident of delivering 15-17 per cent margins in the medium term, led by automation resulting in operational efficiencies from managed service projects. Management remains optimistic about HP/DXC channel and expects it to grow at par with the industry by increasing its wallet share in vendor consolidation. Considering all these factors, we recommend it as a HOLD.