Sagility India soars 5% for second day, surges 71% over IPO price

Sagility India shares surged 5 per cent on Thursday, touching a fresh peak of Rs 51.35. This marks the eighth straight session of gains, with the stock rallying an impressive 61 per cent in the past month. In contrast, the Sensex has dipped nearly 2 per cent during the same period, underscoring Sagility's standout performance in a tepid market.

Brokerage houses show optimism
Global brokerage firm JPMorgan recently initiated coverage on Sagility with an "Overweight" rating and a target price of Rs 54. According to the firm, Sagility is uniquely positioned in the healthcare services sector, catering to non-discretionary spending. This ensures a stable growth trajectory despite market uncertainties. The report also projected a robust fifty per cent compound annual growth rate (CAGR) in earnings from FY24 to FY27.

Jefferies, another global brokerage, echoed this optimism with a "Buy" rating and a target price of Rs 52. It highlighted the company’s potential for sustained double-digit revenue growth driven by its niche positioning and secular tailwinds.

Strength in healthcare outsourcing
Sagility is set to benefit from the growing trend of healthcare outsourcing in the US. With a focus on cost reduction and efficiency improvements, healthcare providers are increasingly relying on Sagility’s expertise in data analytics, mining, and other high-margin areas.

The company’s deep domain knowledge and long-standing client relationships provide a competitive edge, making it a preferred partner for outsourcing. Sagility’s offerings also cater to non-cyclical demand, adding stability to its financial performance.

Financial resilience
JPMorgan emphasized Sagility’s strong EBIT margins, which ensure profitability as the company scales. Its focus on non-discretionary healthcare spending further safeguards revenue from market cyclicality.