Happiest Mind Technologies share price multiplies 4 times in less than 7 months

Happiest Mind Technologies share price: The company's IPO price was Rs 166 apiece. The stock was listed at Rs 351, with a listing premium of 111%. The issue was subscribed 151 times during its three-day bidding process. The market cap of the company now is a whopping Rs 9369 cr. Happiest Mind Technologies share price is Rs 636, up Rs 14 or 2.3% at yesterday's close. The 52 week high on the stock price is Rs 694.9.

Happiest Minds Technologies and BeatRoute have entered into a strategic partnership to solve typical revenue realization problems faced presently by the CPG Industry. The complex CPG eco-system is characterized by multiple channels and relationships including Modern Trade, General/Traditional Trade and other B2B channels that require a seamless, holistic solution to enable smart selling physically as well as digitally. This partnership empowers CPG enterprises with a goal-oriented Digital Transformation journey, by leveraging new age technologies such as ML, Store Analytics, Sales Process Gamification, Bots and Social Channels to drive Sales Uplift and provide brands with a competitive advantage.

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Happiest Minds Technologies is led by its executive chairman, Ashok Soota, and a credible team with 1-2 decades of experience in IT services that has held leadership roles and P&L responsibility at larger peers like Wipro, Mindtree EDS and MuSigma.

Nomura says it has initiated coverage on Happiest Mind Technologies with a Buy rating and target price of Rs 480. Nomura expects Happiest Mind Technologies to trade at a premium as they think it will continue to grow at 2x the pace of large-caps and 1.5x of midcaps, led by the presence in the Digital segment. Nomura factors in its ability to sustain EBIT margins, similar to mid-caps (despite being 1/10th their size).

Nomura says it sees Happiest Mind Technologies as a ‘consistent compounder’. Nomura’s 32x target multiple is 20% higher than the target multiple for Infosys / TCS and 10% higher than 1-year forward average trading multiple of mid-cap IT services.

Nomura says that Digital contributes 97% of FY20 revenues for Happiest Mind Technologies. As per Gartner, Digital is likely to record 16%+ CAGR over the next five years as clients accelerate investments in core transformation to expand product offerings, enhance productivity and drive better customer experience.