Birlasoft Ltd (Birlasoft) has strength in non-ERP digital businesses like CRM, B & data analytics, app development & enterprise solution.
Birlasoft reported strong numbers on the margin front.
Birlasoft’s share price has grown by ~3.3x since it demerger (from ~₹ 114 in February 2019 to ~₹ 374 levels in May 2022).
We value Birlasoft at ₹ 440 i.e. 22x P/E on FY24E EPS.
Apart from Birlasoft, in our IT coverage we also like Mastek.
|Particulars||FY19||FY20||FY21||FY22||5 Year CAGR(FY17-FY22)||FY23E||FY24E||2 Year CAGR (FY22-FY24E)|
|EBITDA Margins (%)||12.0||11.9||14.9||15.5||-||15.7||16.0||-|
|Q4FY22||Q4FY21||YoY (%)||Q3FY22||QoQ (%)||Comments|
|Revenue||1,101||903||22.0||1,072||2.8||Revenue grew by 2.2% in CC terms|
|Gross margin (%)||42.8||40.7||213 bps||43.4||-57 bps|
|EBITDA Margin (%)||15.8||16.9||-103 bps||15.2||66 bps||Margins improved due to lower other expenses|
|Depreciation & amortisation||20||18||12.3||19||6.5|
|EBIT Margin (%)||14.0||14.9||-87 bps||13.4||60 bps|
|Other income (less interest)||23||5||344.4||13||77.3|
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