AAP sweeps away 15 year BJP reign in MCD election – Photos from celebrations1/9 MCD Election Results 2022: The Aam Aadmi Party won the MCD polls with 134 seats, ending the 15-year rule of the BJP in the prestigious municipal corporation and reducing the Congress to just nine seats in a house of 250. Let us take a look at some of the images from the celebrations:2/9 A child dressed as Delhi Chief Minister Arvind Kejriwal takes part in the celebrations of AAP’s victory in the MCD polls, in New Delhi. (PTI Photo) Delhi Chief Minister and Aam Aadmi Party (AAP) convener Arvind Kejriwal with Punjab CM Bhagwant Mann, Delhi Deputy CM Manish Sisodia, Delhi Environment Minister Gopal Rai and other leaders during celebrations after AAP crossed the majority mark in the MCD polls, at the party headquarters in New Delhi. (PTI Photo) AAP supporters celebrate Delhi MCD election results outside a counting centre at Gole Market, in New Delhi. (PTI Photo) Aam Admi Party workers celebrate Delhi MCD election results at Shivaji Maharaj Chowk, Vashi in Navi Mumbai. (PTI Photo) AAP supporters celebrate MCD election results at the party head-office, in New Delhi. (PTI Photo) AAP candidate from the Inder Puri ward Jyoti Gautam celebrates her win with supporters outside a counting centre for the MCD elections at Patel Nagar, in New Delhi. (PTI Photo) A boy dressed as Delhi Chief Minister and AAP National Convener Arvind Kejriwal, in New Delhi. (PTI Photo) Aam Admi Party workers celebrate Delhi MCD election results at Shivaji Maharaj Chowk, Vashi in Navi Mumbai. (PTI Photo)
Services miss estimates; Software better than expected: Services business grew 0.6% q-o-q cc and missed HCLT’s Q3FY23 guidance, mainly due to a 3.8% q-o-q cc decline in the ER&D segment. Growth in the IT&BS segment moderated slightly to 1.6% q-o-qcc but was in line with estimates. BFSI and Life Sciences were the key growth drivers, while communications were the drag among verticals. Growth was led by the Americas region, while Europe and ROW posted declines.
Decline in bookings reflects delays in decision-making: HCLT won 10 large deals in services and three large deals in Software with net-new deal TCV of $2.1bn, down 8% y-o-y. Deal wins were driven by the services portfolio, were centered on cost optimisation and vendor consolidation and came mainly from BFSI, manufacturing and Life Sciences verticals. Management highlighted a ramp-down in discretionary spending in Hitech and communications verticals but pointed to a strong deal pipeline.
FY24 guidance in line with expectations: HCLT has guided for 6-8% y-o-y growth for overall business and 6.5-8.5% y-o-y cc growth in services segment and 18-19% margins in FY24—all in line with our assumptions. We maintain our FY24-25 cc revenue growth and margin estimates and expect HCLT to deliver 6.5% cc revenue growth and 18.4% margins in FY24. However, we lower our earnings forecasts by 2% to factor the higher tax rate indicated by the management.
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Raise PT: HCLT has fared better in Q4, particularly in North America and BFSI, unlike its peers. However, rising demand uncertainty as a US recession nears remains a concern. HCLT’s stock at CMP trades at 17x PE and offers a 5% yield, which in our view should limit downsides and derating. Hence, we raise our target PE to 17x (16x earlier) and raise our PT to Rs 1,125, offering 8% potential upside.
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FII and DII trades: Foreign Institutional Investors (FII) have been net buyers of domestic stocks for successive days now. On Wednesday, FIIs pumped in Rs 2,347 crore. Domestic Institutional Investors (DII) have been net sellers, pulling out Rs 510 crore yesterday.
IPO watch: Syrma SGS Technology enters the final day of bidding today. So far the issue, that opened last week, has been subscribed 2.27 times. Retail investors have subscribed their portion 2.66 times while NIIs have bid for their quota 3.58 times and QIB portion has been bid for 0.71 times.