Share of Quess Corp Limited has delivered more than 200 per cent returns to its shareholders in the last 12 months. The share stood at Rs 268.85 on June 10, 2020. It has zoomed to Rs 820.00 today, translating into gains of 205 per cent during the period. In comparison, Sensex rose 53 per cent in one year.
Rs 5 lakh invested in the share a year ago would have turned into Rs 15.25 lakh today.
The stock has gained 47 per cent since the beginning of this year. It opened 1.7 per cent higher at Rs 782.00 against the previous close of Rs 768.70 on BSE. Market cap of the firm rose to Rs 11,913.99 crore.
The share of India's leading business services provider stands higher than 5 day, 10 day, 20 day, 50 day, 100 day, and 200-day moving averages.
Motilal Oswal expects Quess Corp to be a big beneficiary of the recent labor law reforms.
The brokerage firm has a 'Buy' rating on the stock with a target price of Rs 820 per share. It expects the company to deliver 22% revenue growth in FY22E after a flat FY21, partially aided by a low base.
It should also see a gradual increase in the EBITDA margin (+50bp YoY in FY22E on improving efficiency and a shift towards the higher-margin IT Staffing business) and higher interest income from continued cash additions - this would help the company deliver a 3.4% PAT margin v/s flat adjusted growth in FY21.
"We also see the announcement of a new dividend policy - payout of 33% of FCF over three years - as a positive, especially as this indicates the management is comfortable with the cash generation ability," the brokerage house noted.
"Over the medium term, as both the center and state governments look to liberalize and formalize the labor markets, Quess should be among the biggest direct beneficiaries," it added.
Sharekhan has also maintained a 'Buy' rating on the stock with a target price of Rs 850 per share.
In FY21, the company had a net cash position of Rs 99 crore as compared to a net debt position of Rs 355 crore in FY20.
Global Technology Solutions emerged as the largest earnings before interest, taxes, depreciation, and amortisation (EBITDA) contributing platform in H221.
Monster India had a good year with stronger sales, better product performance, and improved P&L.
Quess Corp reported a loss of Rs 63 crore for the quarter ended March 31, 2021. Loss in the year-ago period stood at Rs 632 crore.
Revenue from operations grew 0.33 per cent to Rs 3004.5 crore in the March-ended quarter against Rs 2994.5 crore a year ago.
Commenting on the results, MD & Group CEO Mr. Suraj Moraje said, "In a year that has been challenging indeed, Quess has been at the forefront of society's war against COVID, even while emerging as an operationally fitter, financially stronger, and more technology-intense organization.
"On the back of this, it has been a pleasure to reward our shareholders with our first-ever dividend payout in line with our new dividend policy," he noted.
"We will continue to innovate our offerings and put our best foot forward while remaining committed to our twin goals of 20% ROE by FY23 and 20% Y-o-Y OCF CAGR," he added.
Quess Corp Limited won 29 new deals in the March-ended quarter and bagged 96 wins during the year.
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