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'Buy' This Stock For 17% Return, In 1 Year: ICICI Direct Recommends

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Brokerage firm ICICI Direct has recommended Tech Mahindra's stocks to buy with a potential upside of 17%, within a target period of 12 months.

 

Target Price

Target Price

The Current Market Price (CMP) of Tech Mahindra is Rs. 1585. The brokerage firm has estimated a Target Price for the stock at Rs. 1860. Hence the stock is expected to give a 17% return, in a Target Period of 1 year.

Stock Outlook
Current Market Price (CMP)Rs. 1585
Target PriceRs. 1860
1 year return17.00%

Company performance
 

Company performance

Tech Mahindra is experiencing firm traction in the Health care and Life Science (HLS) vertical, which is on its way to reaching US$1bn revenues in two to three years from the current annual run rate of ~US$400 mn. ICICI comments, the company's "BFSI is trending towards US$1 bn revenue in FY22 and US$1.5 bn revenue in next 2 to 3 years from ~US$850 mn currently." The communication vertical, continued to be its key growth driver, led by 5G for telcos while 5G for enterprises would take some to pick up. 5G for business is a large opportunity of US$712 bn.

Comments by ICICI Securities

Comments by ICICI Securities

According to ICICI Securities, "Tech Mahindra's share price has grown by ~4.2x over the past 5 years. We remain positive on the stock and maintain BUY rating."

About the company

About the company

Tech Mahindra has over 1.2 lakh employees across 90 countries serving 1000+ clients with higher exposure to telecom, which generates 40% of their revenues. Apart from telecom Tech Mahindra caters to BFSI, manufacturing & retail. The company's dollar revenue CAGR grew at 5.6% over the last 5 years.

Disclaimer

Disclaimer

The above stock has been picked from the brokerage report of ICICI Direct. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.

(Also read: Sharekhan Recommends This Stock To Buy For 21.3% Upside, In 1 Year)

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