Home >Markets >Stock Markets >Mindtree shares up 90% in past year. What brokerages say after Q3 earnings

Shares of Mindtree today surged as much as 6% today but later pared bulk of its gains. In noon trade, Mindtree shares were trading 1% higher at 1689.85. In its third quarter, Mindtree had on Monday reported revenues of $274.1 million, up 5.0% quarter-on-quarter but a decline of 0.4% on a yearly basis. Net profit rose to $44.2 million, a growth of 28.6% quarter on quarter and 59.3% on a yearly basis.

Mindtree shares are up 90% in past one year, making it one of the best performing stocks in the IT sector.

In rupee terms, Mindtree's revenue rose to 2023 crore in Q3 while net profit rose to 326 crore .

What brokerages say on Mindtree earnings:

Motilal Oswal has a neutral rating on Mindtree shares with target price of 1,765. "We upgrade our FY22/FY23 EPS estimates by 10%/11% as we factor in 170bp margin expansion, apart from the strong beat during the quarter. The stock is trading at 20x FY23 EPS. It has been one of the best performers in CY20 in the IT sector, with returns of 88% over the past year. We believe the key positives are already captured, and we see limited upside hereafter," the brokerage said.

Another brokerage Edelweiss has maintained "buy" on Mindtree shares. "Mindtree, akin to larger peers, delivered a solid set of Q3FY21 numbers. Margin at 19.6% beat our and Street’s estimates of 17.5% and 17.1%, respectively. Factoring in higher demand and better execution, we are raising our FY22 and FY23 revenue/EPS estimates by 4%/35% and 3%/28% respectively. We revise up our target price to 2,821 (from 2,044) given better growth trajectory, efficient execution," the brokerage said.

Emkay maintains a sell on Mintree, citing rich valuations. "We raise our FY21/22/23E EPS by 17.6%/15.1%/6.2%, factoring in Q3 performance, better margin trajectory and improving demand outlook. Considering dependency on top client, anticipated subpar revenue growth, unsustainable margins and rich valuations, we maintain Sell with a revised target price of Rs1,580 (earlier Rs1,490) at 20x FY23E earnings."

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