Rs 1,166 to Rs 3,243: This IT stock gave 178% return in 1 year

Shares of Mindtree Limited India surged 7 per cent to hit an all-time high of Rs 3,243 on BSE. The stock has been gaining for the last 2 trading sessions and has risen 10 per cent on the back of strong operational performance for the quarter ended June 2021.

The large-cap stock has delivered more than 150 per cent return to its shareholders in the last 12 months. In the last one year, Mindtree Limited share price jumped from Rs 1,166.5 to Rs 3,243 mark - logging around 178 per cent return in this period. In comparison, the Nifty 50 index gained over 45.5 per cent and the S&P BSE Sensex rose over 44 per cent.
 
An amount of Rs 5 lakh invested in this multibagger stock a year ago would have turned into Rs 13.90 lakh today.

With a market capitalisation of Rs 52,650.25 crore, the share stands higher than 5 day, 10 day, 20 day, 50 day, 100 day, and 200-day moving averages.

The company reported a net profit of Rs 343.40 crore for the quarter ended June 2021 compared to a net profit of Rs 213 crore in the year-ago period. Revenue from operations grew 20 per cent to Rs 2,291.70 crore in the June-ended quarter against Rs 1,908.80 crore a year ago. The EPS has increased to Rs 20.85 in June 2021 from Rs 12.94 in June 2020.
 
According to MarketsMojo, the company has declared positive results for the last 5 consecutive quarters. It has strong long-term fundamental strength with an average Return on Equity (ROE) of 21.06% and has a low Debt to Equity ratio (avg) at -0.36 times.

The technical trend has improved from Mildly Bullish on July 12, 2021, and the stock is technically in a Bullish range now. Multiple factors for the stock are bullish like MACD, Bollinger Band, KST, and DOW.
 
The stock is trading at a premium compared to its average historical valuations and with an ROE of 26.6, it has a Fair valuation with a 10.7 Price to Book Value. The company has High Institutional Holdings at 25.65% and their stake has increased by 0.87% over the previous quarter.
 
"We upgrade our FY22E/FY23E EPS estimate by 4%/6% as we increase our growth estimates on the back of a strong deal pipeline and expectations of decent conversions in FY22E. This will be partially offset by expectations of lower margin (on normalisation of utilisation levels) and higher employee cost," said Motilal Oswal.
 
"Mindtree is seeing healthy traction in travel clients (led by leisure travel). An increase in business travel will further boost growth. Further, considering the company’s ability to cross sell, up sell, inorganic expansion, organic expansion via P&L, expansion in Europe and higher growth in BFSI & Retail prompts the company to believe it will be able to clock industry-leading double-digit growth in FY22E (which we estimate at 21% YoY)," ICICI Direct noted.