Hinduja Global Solutions is a global business process management company. The company has a consolidated topline of 2800 crores with a PAT of around 165 crore. The stock has a EPS of around 80 for FY15 and is currently trading at 6x. I can see a lot of consolidation happening 500 levels in this stock and this looks like a strong buy opportunity at the current levels.
They have acquired 2 business in the past quarter.
- Hinduja Global Solutions acquired 89.9% stake in US based health insurance focused cloud tech company Colibrium for an undisclosed amount. Colibrium reported revenues of $12.6 Mn(70-75crores) in the last calendar year.
- Mphasis sold a significant portion of its domestic business to Hinduja Global Solutions. All 7,000 Mphasis’ employees will be transferred to HGS. The deal value was Rs 17 crore but HGS is getting Rs 140-160 crore in revenue along with new clients and new processes that they could look to leverage for the international market.
Considering these 2 acquisitions and modest growth of 5% in the existing business it should post a topline of 3100 crores (2800*1.05+75+140) for FY16 with PAT of around 180 crores (margins remain stable).
The stock looks dirt cheap at this price. Would like to hear thoughts from fellow members on this.