Motilal Oswal Positive On Multibagger IT Software Stock Amid Strong Growth, Buy

Motilal Oswal has remained positive on IT Software sector stock, HCL Technologies and assigned buy call with a target price of Rs 1240 apiece. According to Oswal, "Management maintained its positive stance on the IT Services and ER&D verticals, and provided its outlook on HCL Software (P&P) business." If you buy HCL Technologies at the current market price of Rs 1028 apiece, you will get potential 21% return. Check key takeaways below:

1. HCL Technologies Stock Outlook

The last trading price of the stock is Rs 1028 apiece with 52-week high at Rs 1359 apiece and 52-week low at Rs 875 apiece, respectively. The company has a market capitalisation of Rs 2,79,046.18 crore.

2. HCL Technologies Return

The stock has given multibagger returns to investors. In the last 5-years the stock has given 135% return. It has jumped 92% in last 3-years, and declined 11% in last 1-year. It has gained 8% in last 3-months.

3. Valuation

According to Motilal Oswal, "Higher exposure to Cloud, which comprises a larger share of non-discretionary spends, offers a better resilience to its portfolio in the current context, with higher demand for Cloud, Network, Security, and Digital workplace services. Strong growth within Services and ER&D, robust headcount addition, healthy deal wins, and a solid pipeline indicate an improved outlook. Given its capabilities in the IMS, Digital space and strategic partnerships, as well as investments in Cloud, we expect HCLT to emerge stronger on the back of a likely increase in enterprise demand for these services. The stock is trading at ~17x FY24E EPS, which offers a margin of safety. Our TP of INR1,240 is based on 20xFY24E EPS. We reiterate our BUY rating."

4. About HCL Technologies

HCL Technologies Limited is a renowned global IT services company that assists global enterprises re-imagine and transform their businesses through Digital technology transformation. The Company is primarily engaged in providing a range of software services business process outsourcing and infrastructure services.

Disclaimer

The stock has been picked from the brokerage report of Motilal Oswal. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.