Birlasoft - Ambitious, or super normal?

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Key results conference call takeaways

  • Strong demand environment across industries with a robust deal pipeline. New deals @ 67% of TCV, indicating solid revenue ahead.
  • Lots of opportunities in business transformation and digital
  • Margins in control and no contraction is expected due to efficiency improvement despite costs.
  • Hiring strategy in short term is focus on sub-contractors and consultants. In medium term shifting pyramid by training and reskilling with new technologies. Long term increasing intake of freshers
  • Better pricing across customers, and this will show up in 4QFY22. New deals are being signed at higher pricing.
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Birlasoft Q4 PAT rises 16% QoQ; board announces Rs 390 cr buyback | Business Standard News.

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This stock has run up and is not trading at 41 PE. Can anyone tell me how can an IT services company command such a valuation? May be a product company can, but how can a services company command this?

Note: I have a small position, and made quite a handsome return. Unfortunately didnt bet big, but now thinking of getting out. Technical tell me that stock is in a trend.

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PE is high because of one time loss in Q3FY23, if we exclude that PE would be ~28

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