250% Dividends: BSE 500 Listed Multibagger Stock Up 7% Last Week; PL Suggests Buy For TP Of Rs 572

Brokerage Prabhudas Lilladher has added BSE 500-listed Zensar Technologies as its medium-term tech pick. Zensar's 50 EMA level hints at further rise in the stock price. The brokerage suggested buying to accumulate the stock for a target price of Rs 572.

The midcap IT stock made a strong rally last week. On BSE, the stock ended at Rs 522.60 apiece, up by 1.4% on Friday with m-cap at Rs 11,837.76 crore. Its weekly gain is nearly 7%.

Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher said, "The stock has indicated a higher bottom formation pattern on the daily chart with a Cup & Handle pattern also visible in the longer-term time frame with currently improving the bias moving past the significant 50EMA level of 504 zone anticipating for further rise."

She also added, "The RSI has indicated a trend reversal from the oversold zone and currently is well placed indicating strength to carry on with the momentum still further ahead from current levels."

"With the chart looking good, we suggest buying and accumulate the stock for an upside target of 572 keeping the stop loss of 490," Parekh said.

Zensar Tech conceptualize, builds, and manage digital products through experience design, data engineering, and advanced analytics for 145+ global clients. Its solutions leverage industry leading platforms and help clients be competitive, agile, and disruptive as they navigate transformational changes with velocity.

Year-to-date, Zensar shares have zoomed by nearly 144% on BSE, emerging as a multi-bagger. The stock price was below Rs 215 at the start of January month.

During Q2FY24, Zensar reported revenue of $150.2M, a sequential QoQ growth of 0.6% in reported currency and 0.2% in constant currency. EBITDA was at 18.6% and PAT stood at 14.0% of revenues. The company reported net cash of $227.1M at the end of Q2FY24, a quarterly YoY growth of 40.1%.

Sachin Zute, CFO, of Zensar, commenting on the Q2FY24 performance last month said, "As we step into the second half of this fiscal year, we have a healthy order book. We continue to stay focused on execution, innovation, and cost optimization to further maintain Zensar's financial performance achieved in the last few quarters."

Zensar has held a huge track record of paying dividends to its shareholders. Since September 2002, the company declared 34 dividends, as per Trendlyne data. In FY23, the company paid 250% dividends amounting to Rs 5 per share.

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