This Software Stock Announced Bonus Share In 1:2 Ratio, Buy It For Potential Gain Of 17%

ICICI has given buy call to the software stock namely eClerx Services Ltd for a target price of 2520 apiece with a potential gain of 17%. The board of director of the company has approved bonus issue on August 9, 2022 in the ratio 1:2.

The board of directors of eClerx Services Ltd stated in their regulatory filing, "Approved the issuance of Bonus Equity Shares in the proportion of 1 (one) new fully paid up equity share of Rs. 10/- (Rupees Ten Only) each for every existing 2 (two) equity shares of Rs. 10/- (Rupees Ten Only) each held by the members as on the record date, subject to shareholders' approval through Postal Ballot. Additional details as required as per Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with SEBI Circular No. CIR/CFD/CMD/4/2015 dated September 09, 2015 is attached herewith as Annexure I."

eClerx Services Ltd Stock Outlook

The current market price of the stock on BSE is Rs 2212 apiece with a 52-week high of Rs 2970 apiece and 52-week low of Rs 1769 apiece. The stock gained 2.29 % in today's trading (August 12, 2022). The stock has gained 297% in 3 years and 76% in 5 years. According to ICICI Direct, if investors buy the stock now it can reach the target of Rs 2520 in 12 months with a potential gain of 17%.

Key Triggers For Future Price Performance And Valuation

Traction in customer care, RPA, analytics & content development, cross sell and up sell to Personiv clients to drive growth. Lower roll-offs, improving deal wins and revival in growth are expected to drive revenues. Expect dollar revenues to grow at 17.8% CAGR in FY22-24E. According to ICICI Direct, "eClerx' share price has grown by ~1.6x over the past five years (from ~Rs 1,288 in August 2017 to ~Rs 2,155 levels in August 2022). We value eClerx at Rs 2,520 i.e. 16x P/E on FY24E EPS."

eClerx Services Ltd Q1FY23 Results

eClerx reported its Q1FY23 results and stated that revenues increased 3.9% QoQ in CC terms to US$79.5 million. EBITDA margin declined ~400 bps QoQ to 26.7%. The board recommended bonus shares in the ratio of 1:2

eClerx Services Ltd Dividend History

It has been maintaining a good dividend history and regularly declared dividend in the last 5 years. It has a dividend yield of 0.04%. It has declared an equity dividend of 10% or Re 1 per share for the year ending March 2022.

eClerx Services Ltd Overview

The company serves several industries that may include cable and telecommunication, retail, fashion, media and entertainment, manufacturing, software, and high tech, among others. Its customizable services and solutions optimize the way companies conduct business by streamlining processes and improving business performance. eClerx was founded in 2000 by Anjan Malik and PD Mundhra with the goal of transitioning, managing and transforming complex business processes. It has a market capitalization of Rs 7,483 crore.

Disclaimer

The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.