Mphasis is a company that provides IT services, primarily in the form of consulting. It also provides outsourcing services in addition to infrastructure technology. Application management services are also part of the services provided by the company. The sectors it services are the financial services sector, telecom sector, logistics sector, and the technology sector.Market Capitalisation
At of the end of the third week of August 2018, the market capitalisation of Mphasis was about Rs.23,170 crore.
Mphasis Wealth and Recent Performance
From the financial results released for the quarter ending June 2018, the following can be observed:
- There was a 7% increase in the quarterly gross revenue.
- There was an increase of 22.5% in the yearly gross revenue.
- Net profit grew by 8.7% over the quarter and 38% over the course of the year.
- The earnings per share increased by 8.6% over the quarter and 47% over the course of the year.
- The revenue from Direct Core increased by 8.5% over the quarter and 21.3% over the course of the year.
- In addition to the Direct Core revenue, the revenue from DXC/HP grew by 8.3% over the quarter and 29.9% over the course of the year.
From the condensed standalone interim financial statement released for the quarter ending June 2018, the following things were observed:
- The total assets of the company increased to Rs.4,940.458 crore from Rs.4,665.951 crore in the previous quarter.
- The total equity of the company increased to Rs.3,977.858 crore from Rs.3,907.424 crore in the previous quarter.
- The total income of the company increased to Rs.852.715 crore from Rs.822.375 crore in the previous quarter.
- The total profit over the quarter increased to Rs.170.706 crore from Rs.164.799 crore in the previous quarter.
All in all, the company had a very profitable first quarter in the financial year 2018–2019 compared to the final quarter of the financial year 2017–2018.
Mphasis Stock Trends in 2018
In January 2018, the stock price began at about Rs.738. The stock climbed over the course of the year to close at about Rs.1,151 by the end of July 2018.
- After a brief dip in prices in the first week of January 2018, the stock rallied a little towards the close of the second week of the month. From then, till the end of the month, the stock indicated an upward trend in prices. In fact, the stock closed at about Rs.894 at the end of the month which was a more than Rs.150 increase in share price compared to the price at the beginning of the month.
- There were minor fluctuations in price over the course of February 2018, but overall, the stock held steady to close at about Rs.859 at the end of the month.
- There were two periods of decline and recovery in March 2018 but the stock did not recover enough to make up for the losses. The final price for the month was still lower than what the stock closed at on the final day of February 2018. The stock closed at about Rs.837 at the end of the month.
- April 2018 marked a period that indicated an upward trend in the price of the shares of the company. This was the period during which the price of a single share crossed the Rs.1,000 mark. The final price at the end of the month was about Rs.1,036.
- There was a brief dip in May 2018 during which the stock went below the Rs.1,000 mark. After that, the stock rallied and crossed the Rs.1,000 mark again. While the stock hit a high of about Rs.1,129 during the course of the month, that price level could not be sustained and the final price for the month was about Rs.1,101.
- The stock opened lower in June 2018 at Rs.1,057 and fluctuated a lot during the course of the month. The final price for the month was about Rs.1,084. While this was an increase from what the share price had been at the beginning of the month, the price was still lower than the high that it had reached the previous month.
- The stock opened higher at about Rs.1,100 in July 2018 and followed an upward trend over the course of the first two weeks of the month but that level could not be sustained. The stock then fluctuated a lot to close for the month at about Rs.1,151. A final 200% dividend was announced on 26 July 2018.
Mphasis Stock Trends in 2016 and 2017
- The stock began trading at about Rs.496 in the beginning of January 2016. There was a steady drop in the prices of the shares throughout the month of January with the stock closing at about Rs.456. In February 2016, the price of the share dropped further with the final price for the month being about Rs.420. In March 2016, the stock opened at about Rs.440. During this month, the stock recovered a lot and the price of the stock even exceeded Rs.500. The final price for the month was about Rs.491.
- There was a brief dip in prices in April 2016 which was followed by an increase in the prices but the stock reduced finally to close at about Rs.489 at the end of the month. The stock price dipped some more in May 2016 and did not recover until the last week of that month. The final price for the month was about Rs.524. The price increased to over Rs.550 in June and dipped again. This dip was followed by a strong recovery during which the price hit a high of about Rs.594. The stock closed for the month at about Rs.573.
- The stock dipped a bit in July to close for the month at about Rs.540. The stock fluctuated a bit in August 2016 but closed for the month at about Rs.567. The stock dipped some more in September 2016 with the price being about Rs.519 at the end of the month.
- The price increased a little in October 2016 but dipped again to close for the month at about Rs.513. A final 200% dividend was announced on 19 October 2016. In November 2016, the price held largely steady and the stock closed for the month at about Rs.526. While the stock did not improve much in price during the first two weeks of December 2016, it rose in the final two weeks to close at about Rs.565 at the end of the month.
In January 2017, the stock price opened at about Rs.557. It fluctuated a lot over the course of the year but closed at a higher price in December. The final price for the month of December 2017 was about Rs.725.
- While the share price opened at about Rs.557 in the beginning of January, the price dipped almost immediately for the first two weeks of the month. The stock recovered a little towards the end of the month to close at about Rs.559. The price remained steady for the first two weeks of February 2017, with the stock increasing in price towards the latter part of the month. This price increase was not a steep increase. It was more of a minimal increase. The final price for February 2017 was about Rs.595. The stock dived in price during the course of the first week of March 2017 but rose again in the second and third weeks. During this time, the stock hit a high of about Rs.599 for that month but then the stock could not sustain those price levels till the end of the month. The share price dipped again in the final week of the month to close at about Rs.579.
- The downward trend of the stock continued for the month of April 2017 with the stock recovering a little in the middle of the third week of the month. This minor recovery was followed by another decrease in prices with the stock going as low as about Rs.530 during the course of the next week. The final price for the month was about Rs.536. The stock increased in price during the month of May 2017 with the stock breaching the Rs.600 mark. The final price for the month was about Rs.613. The stock went even higher in June 2017, with a high of about Rs.644. The stock price dipped immediately after. But it remained mostly over Rs.590 for the rest of the month. The final price for June 2017 was about Rs.599.
- During the course of July 2017, while the stock did rise to around Rs.616, the final price for the month was lower at about Rs.604. The price dipped again in August 2017 with a low of about Rs.571 but the stock rallied after that to close for the month at a higher price of about Rs.609. The stock remained steady for most of the month of September 2017. There was a dip during the last week but the stock rallied to close at about Rs.618 at the end of the month.
- October 2017 marked a period of intense growth for the stock with the price going over Rs.650. The final price for the month was about Rs.693 which was quite an increase from the price of the stock at the close of the previous month. The first week of November 2017 marked a period of growth but the stock did not sustain that increase in prices. During the hike in prices, the stock breached the Rs.700 mark. The high for the month was about Rs.738. While there was a dip in the prices, the share price did not go below Rs.700 that month. The final price for the month was about Rs.728. In December 2017, the price of a share spiked to slightly over Rs.750 but the stock dipped a little after that to close for the month at about Rs.725.
Should You Invest in Mphasis?
There are a number of reasons why Mphasis stock can be considered a good buy.
- The Blackstone Group picked up Mphasis as one of their purchases. This indicates the potential of Mphasis as a company.
- Reuters analysts appear to have predicted a strong future growth in performance for Mphasis. This is partly based on the fact that Mphasis’ sales in FY18 was about Rs.6,502 crore.
- There continues to be a strong revenue stream from HP.
- Mphasis is completely debt free and has a strong surplus and reserve.
- Mphasis is one of the few information technology companies that increased over 100% in price over one year in the FY18.
- The company has shown strong growth in every metric possible. The year-on-year growth for FY18 was high as was the quarter-over-quarter growth for the first quarter of FY19.
- A number of foreign firms have looked at increasing their stake in Mphasis since it has proved to be a good performer.
- The total number of institutional investors in the company increased to about 69 in April 2018.
Mphasis can be considered more of a long-term investment than a short-term one. While all of the given information and the stock prices of the company are good indicators that the company is poised to grow strongly, it would be best to invest in the shares of the company after studying it thoroughly. This study should take into consideration your personal financial commitments and risk appetites.
The company has over 30 office locations in 19 countries around the world. The company has delivery centres in Australia, North America, Europe, and Asia. In India, the company has offices in Bangalore, Raipur, Chennai, Hyderabad, Pune, Vadodara, Mumbai, Indore, Puducherry, Ahmedabad, and Mangalore.
History of the Company
Two companies, Mphasis Corporation, an IT consulting company based out of the USA, and BFL Software Limited, based out of India, merged in the year 2000 to form Mphasis. In 2006, a company called Electronic Data Systems bought 42% controlling stake in Mphasis for $80 million. EDS operated Mphasis as an independent unit. In 2008, Hewlett-Packard acquired Mphasis from EDS for $13.9 billion. In 2009, Mphasis changed its name to “Mphasis, an HP Company” since it became a subsidiary of HP and was listed on Indian stock markets as Mphasis Limited. At this point, HP owned 60.5% of Mphasis. About half of Mphasis’ revenues came from services it rendered for HP. In 2010, Mphasis made $1 billion in revenue for the first time. In 2014, the company changed its brand name to “Mphasis Unleash the Next”. In 2015, the company transferred a significant part of its Indian business to Hinduja Global Solutions. HGS is a world-class company when it comes to providing excellent customer experience. Mphasis partially sold its Indian outsourcing business to a company called Karvy Data Management Services Limited. In 2016, HP decided to sell its controlling shares in Mphasis. The Blackstone Group LP acquired 84% of the shares that HP held in Mphasis. The company later changed its name to “Mphasis The Next Applied”.
Management of the Company
The board of directors of the company includes the following people:
Davinder Singh Brar - Chairman
Nitin Rakesh - CEO and Wholetime Director
N Kumar - Director
Jan Kathleen Hier - Director
David Lawrence Johnson - Director
Mr. Marshall Lux - Director
Paul James Upchurch - Director
Amit Dixit - Director
Amit Dalmia - Director
In addition to the CEO, the executive council of the company includes the following people:
Eric Winston - Executive Vice President, General Counsel and Chief Ethics and Compliance Officer
Dinesh Venugopal - President - Mphasis Direct and Digital
Elango R - President - DXC and HP - SBU
Sundar Subramanian - President - Global Delivery
Puneet Bhirani - CEO - Digital Risk
Srikanth Karra - Chief Human Resource Officer (CHRO)
V Suryanarayanan (Surya) - Executive Vice President and Chief Financial Officer
The Chairman, D S Brar, has been part of the board of directors since the year 2004. He has a Masters in Management from the University of Delhi. He initially worked with Associated Cement Companies. From there, he moved to Ranbaxy Laboratories Limited. In Ranbaxy, he grew into the position of CEO and MD. At present, in addition to being on the board of Mphasis, he is on the board of a number of organisations and he was the Director of the Reserve Bank of India from the year 2000 till the year 2007.
The CEO, Nitin Rakesh, joined Mphasis in the year 2017. He has a Masters degree in Management from Narsee Monjee Institute of Management Studies, Mumbai. In addition to this, he is also an alum of the Harvard Business School’s CEO Workshop. He has extensive experience in the finance sector (comprising banking, financial services, and insurance) where he worked prior to moving into the technology sector.
Mphasis Listing in BSE, NSE, and Other Indices
The company is listed under the following codes:
SECT: Information Technology
IND: IT Consulting and Software
ISIN Code: INE356A01018
The company is a part of the following indices:
- Nifty 200
- Nifty Full Midcap 100
- Nifty Midcap 100
- Nifty MidSmallCap 400
- S&P BSE 200
- S&P BSE 400 MidSmallCap Index
- S&P BSE AllCap
- S&P BSE Information Technology
- S&P BSE MidCap
- S&P BSE Momentum
- Nifty 500
- Nifty LargeMidcap 250
- Nifty Midcap 150
- S&P BSE 150 MidCap Index
- S&P BSE 250 LargeMidCap Index
- S&P BSE 500
- S&P BSE Dollex - 200
- S&P BSE LargeMidCap
- S&P BSE MidSmallCap
- S&P BSE TECk
In addition to The Stock Exchange Mumbai and the National Stock Exchange of India Limited, the company’s stock is also listed on the following exchanges:
- Bangalore Stock Exchange Limited
- Cochin Stock Exchange Limited
- Madras Stock Exchange Limited
- Calcutta Stock Exchange Association Limited
- Delhi Stock Exchange Association Limited
- MCX Stock Exchange
- Over The Counter Exchange of India Limited
The registered office of the company is located at the following address:
Bagmane World Technology Center, Marathahalli Outer Ring Road, Doddanekundi Village, Bangalore - 560 048
Phone number: +91 080 6750 4613 or +91 080 6750 4410
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