Up 3x in 3 years, Ashish Dhawan-owned IT stock among analysts' long-term favourites

Birlasoft, a multibagger stock owned by ace investor Ashish Dhawan, has the potential to give returns to the rune of 38 per cent in the long term. That's what analysts feel about the smallcap IT stock, which has taken a breather after growing more than three times in value in just three years.

What analysts recommend on Birlasoft shares

Birlasoft's revenue growth is expected to be driven by improvement in its deal pipeline in the Cloud and technology business, and sustained momentum in the BFSI unit, according to Nirvi Ashar, an analyst at Religare Broking. 

Religare has a 'buy' rating on Birlasoft with a target price of Rs 341 apiece -- implying an upside potential of 24 per cent in the stock from its closing price on Tuesday.  

The brokerage also expects the following to aid the IT company's growth: 

• A pickup in demand from manufacturing 
• An uptick in deals from Europe and America 
• Focus on managing costs that will support in operating performance

Sharekhan also has a 'buy' call on Birlasoft, with a target price of Rs 340-380 per share. The brokerage's target suggests an upside of 38 per cent in the stock. 

Birlasoft share price: Historical performance  

Birlasoft is a multibagger, having surged from Rs 90 apiece to Rs 275 per share over a period of 3 years. 

However, the stock has declined more than 34 per cent in the last one year, a period in which the Sensex headline index has risen six per cent. 

Also Read: Stocks to buy: These 5 IT shares may give bumper returns in 3-4 weeks - check price targets

Birlasoft is a debt-free company with a healthy double-digit return ratio and a return on capital employed (RoCE) of over 19 per cent, according to ICICI Direct.  

Birlasoft, part of Ashish Dhawan's portfolio

Dhawan held 27,64,615 equity shares -- equivalent to 1.01 per cent of the company's equity -- at the end of December 2022, according to shareholding data from the bourses. 

The renowned stock market investor publicly holds 13 stocks in his portfolio, with a net worth of over Rs 2,187 crore, as of February 28, 2023, according to stock analysis website Trendlyne. 

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