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Rakesh Jhunjhunwala portfolio: After remaining sideways for first 3 months this year, Crisil share price has come out of the consolidation phase. Now, this Rakesh Jhunjhunwala stock is giving upside movement logging near 6 per cent rise in last one month. The stock has managed to give more than 15 per cent return to its shareholders in YTD time. However, after the announcement of strong Q4 earnings, Yes Security is expecting more upside in this Big Bull-backed rating agency company's stock. It is expecting that Crisil share price may go up to 4,100 apiece levels in 12 months, delivering near 25 per cent return to its shareholders in this period. Crisil share price today at NSE is 3375 per share.

Highlighting the fundamentals of this Rakesh Jhunjhunwala holding company, Yes Securities report says, "CRISIL delivered a robust operating performance in Q1 CY22 (4% Revenue/16-17% EBITDA & Earnings beat) characterized by multi-year high revenue growth of 20% yoy and EBITDA margin of 29.6%. The strong growth performance was driven by a) improved growth momentum in domestic ratings business (continuous market share gains), b) sustained traction in GR&RS business underpinned by strong demand for core offerings in research, risk, regulatory support, and transformation, capabilities to tap new opportunities and new client additions, c) strong performance of India Research business on continued buoyancy in capital markets and economic recovery and, d) an integrated approach in GBA business driving wallet share gains within key clients and new client additions."

Raising the earning estimates of Crisil, the brokerage report said, "We raise earnings estimates by 4-5% across CY22-24 by lifting growth and margin assumptions on the back of strong performance delivery in Q1 CY22 and positive management commentary about concurrent trends in market/wallet share in various businesses and readiness/capabilities to tap evolving opportunities (related to ESG and others). We estimate 15%/23% consolidated revenue/PBT CAGR over CY21-24 and ~400 bps margin expansion through the period. Improved margin and growth will cause RoE to expand by 6 ppt to 38% in CY24. Stock trades at 41x 1-yr rolling fwd. P/E, and its peak valuation has been around 55x in the past seven years. Multiple is expected to re-rate on prospects of substantial RoE expansion."

On its suggestion to positional investors in regard to this Rakesh Jhunjhunwala portfolio stock, Yes Securities report says, "We reiterate BUY and raise 12 month price target to 4100 (earlier 3750).

Rakesh Jhunjhunwala share holding in Crisil

Rakesh Jhunjhunwala and his wife Rekha Jhunjhunwala have shareholding in Crisil. As per share holding pattern of this rating agency company for Q4FY22, Rakesh Jhunjhunwala holds 21,29,250 Crisil shares, which is 2.92 per cent of total paid-up capital of the company whereas his wife Rekha Jhunjhunwala holds 18,70,750 Crisil shares or 2.56 per cent stake in the company.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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