Sunday, April 16, 2006

Hexaware Technologies

Hexaware is a global provider of IT and Process outsourcing services with presence in the Americas, Europe and the Asia Pacific region. The company has an active base of over 100 clients and has companies like Peoplesoft and SAP as partners. It operates in the HR outsourcing space. Net net, Hexaware is a new-age technology company ... and ... the valuation is very interesting. Measure this :
1. Revenues have grown by 24.3% over LY and is now at INR 678.6 crs (press release)
2. PAT grew at 43.6%; now at INR 91.4 crs
3. 39 new clients added; 129 active clients
4. At a CMP of 150 (Apr-15) and a share capital of 23.48 crs (FV per share is 2.00 rupees) ... the P/E comes to 19.13.

The company has given a guidance for Q1 FY2006: 167 crs in revenue and 23 crores in profits ... which spells the growth objective of the organisation. Extrapolating the expected growth in business (as a function of manpower recruited, clients added, previous trends), I find the company well on course to reach a 1000 crs of revenue by 2008. Thus, profits will also rise at a CAGR of 27%. I estimate the 1-yr fwdPE at 16.6 which is much lower than peers such at 3i and Matrix.

Hexaware Technologies is a long-term buy.


Blogger Shankar said...

Sensex up: 2.69% today. Hexaware was up 5.4% today; Satyam up 6.99% today. I bought some NIIT Tech today (recommended earlier at 180) @ 203 rupees. Was up .. 9.6%. Today was the day of IT somewhat

4:50 PM  
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5:54 PM  

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