Mindtree Ltd - Strong operating performance, retain HOLD - Emkay

Reco: HOLD
CMP: Rs 1373
Target Price: Rs 1500

- 4.5% QoQ revenue growth beat expectations aided by a a strong 6.2% QoQ growth in Hitech. EBITDA margins improve by 200 bps QoQ to 21.5% aided by lower SG&A expenses

- Operating metrics performance remains decent with strong growth from focus verticals/top clients. Cash generation however poor with onsite mix of business increasing further

- Management remains confident of beating industry growth driven by strong deal wins/pipeline. Hopes to maintain margins on a full year basis on a constant currency basis

- Retail HOLD, TP Rs 1,500. FY15/16E EPS remain unchanged. We see stock reacting positive to Mar'14 qtr beat however believe that earnings upgrade led by upside risks to operational performance nearing the fag end

Source : Equity Bulls

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