Buy Firstsource Solutions Ltd - Motilal Oswal

Firstsource Solutions Ltd (FSOL.IN; Mkt Cap USD 158m, CMP Rs 16.50, Buy)

Firstsource Solutions Limited reported results in line with our expectations

Revenue grew by 4.8%/2.2% yoy/qoq in INR terms and 7.3%/5.1% in constant currency terms.

Operating margins dipped by ~100 bps yoy & qoq to 13.1% primarily due to one time expense of Rs 6.4 crore on rationalisation of operating centers and lower gains on forex hedges.

The barclays card project started in November 2010 and revenues for 2 months appear in the numbers for this quarter.

Expected to breakeven at the EBIT level in domestic business during Q4FY11.

Source : Equity Bulls

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