Hold Firstsource Solution Stock, target Rs 31: ICICI Direct

Firstsource Solution Stock Hold Call; Icici Direct

Firstsource Solution Stock Call;- Firstsource Solution (FSL) detailed a blended arrangement of Q4FY20 numbers. While incomes expanded 2.6% QoQ and 11.7% YoY, EBIT edges fell 40 bps QoQ, 154 bps YoY to 10.8%. The expansion in income was driven by 6.8% QoQ development in telecom and media vertical and 1.7% QoQ increment in BFSI. In general obligation has expanded by Rs 290 crore to Rs 836 crore in FY20.

Firstsource Solution Stock Analysis

We expect close to term incomes to be affected by valuing pressure in social insurance and difficulties in top customer. This is relied upon to mark Q1FY21E incomes by 10% QoQ.

This sharp drop in Q1FY21E is relied upon to affect FY21E incomes and edges. Thus, we update our FY21E incomes and EPS appraises downwards. Also, we accept the obligation will stay raised because of higher DSO days. Henceforth, we minimize the stock from BUY to HOLD with an amended objective cost of Rs 31.

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