Happiest Minds share price hits new 52-week high; soars 3 times from IPO price

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February 18, 2021 11:14 AM

Happiest Minds Technologies share price surged another 11 per cent to hit a fresh 52-week of Rs 538 apiece on BSE in an otherwise range bound trade on Thursday

happiest minds technologies, happiest minds, nomuraHappiest Minds Technologies share price has now zoomed 224 per cent or three times from its IPO price of Rs 166 apiece

Happiest Minds Technologies share price surged another 11 per cent to hit a fresh 52-week of Rs 538 apiece on BSE in an otherwise range bound trade on Thursday. In the previous session the stock zoomed 20 per cent after the brokerage firm Nomura initiated coverage with a ‘buy’ rating to it. So far in intraday deals, 7.40 lakh shares have traded on BSE, while 99.34 lakh shares have exchanged hands on National Stock Exchange (NSE). Since Monday last week, Happiest Minds Technologies stock price has rallied nearly 55 per cent from Rs 348 to Rs 538 apiece. Nomura expects the firm to grow at double the pace of large caps.

“While the recent run-up in the stock is likely to limit the upside in the near term (2.5x of the IPO price),” analysts at Nomura said. Happiest Minds Technologies share price has now zoomed 224 per cent or three times from its IPO price of Rs 166 apiece. The stock was listed at Rs 351, with a listing premium of 111 per cent. The issue was subscribed 151 times during its three-day bidding process. Happiest Minds Technologies had reported 97.1 per cent rise in consolidated net profit at Rs 42.15 crore for quarter ended December 31, 2020. The IT firm’s revenue grew 14.6 per cent on-year to Rs 201 crore from Rs 176 crore in the corresponding quarter of the previous year. However, operating revenue in US dollar terms grew 8.8 per cent on-year.

Happiest Minds Technologies derives 87 per cent of its revenues from the US and Europe and no vertical contributed more than 21 per cent of its revenues as of FY20. Analysts in the initiate coverage report said that Happiest Minds Technologies is expected to trade at a premium and will continue to grow at around 2x the pace of large-caps and around 1.5x of midcaps, led by the presence in digital. “We like the stickiness offered by PES and scalability offered by DBS/IMSS; and we factor in its ability to sustain earnings before interest and tax (EBIT) margins, similar to mid-caps (despite being 1/10th their size),” analysts said.

Nomura in its report said that Happiest Minds Technologies lacks domain expertise barring select areas and is the key focus area of investment. “Inability to beef up domain capabilities could be a key risk to scaling accounts, in our view,” it added.

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