Or it may enabling resolution to raise money if any fruitful acquisition come across.
What is the rationale behind raising funds and diluting equity when the company has recently paid a strong dividend?
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Yes the explanatory statement to the Postal Ballot specifies that they intend to raise funds upto INR 300 crores by way of QIP (most likely) to fund acquisitions. They had done a similar QIP some years back.
they have not done QIP. they just took mandate for the same if they have any opportunity. lets what they will do this time. we have to trust management for their intent
Unable to find out reason for todayâs fall. There is no news. Is it impacted by US tariffs? Doesnât this come under services?
The fear is that if there is slowdown in US the services industry will also be impacted and since MPS has almost 50% + exposure to US the stock price fell
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A) They have acquired brands AJE, LLC and AJO which market shares from USA and China respectively. The objectives of this acquisition âŚdigital language editing services through automation and applying AI / ML in editing process.
B) The projected Financial after acquisition of AJE,
Revenue, EBITDA and NP as under
Main Business, 550 Cr and AJE 200-220 = ~ Rs 750Cr (Actual revenue for 9 months 550.2 Cr)
EBITDA Main Business 30% and AJE 14%
NP Main Business 22% and AJE 7%
C) Target Revenue of FYâ28: Rs 1500 Cr
PAT margin 20%
EPS: 175/- (Assume no change on the equity base)
Book Value: ~ 600/-
^^ the concern of the valuation
The management are good and delivered result as per the guidance.
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Microsoft Word - MPSL_SE_2025-26.pdf (2.2 MB)
Q1 - FY26 , Investor Presentation file
Whats the reason of such fall? Results not that bad. Anyone can share insights
Y-o-Y basis result is Good BUT
Q-o-Q basis result is very flat âŚAs per my understanding Q2 also similar to Q1 and some good improvement will be possible on Q3
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In the call they had mentioned that 10-12% organic growth will be there but they will bring down the revenue from AJ to 12 million $ as compared to 18 million $ last year to improve the profitability. So from topline perspective, not sure how they will grow more than 15%. But they reassured to meet their guidance of 1500 Cr topline by FY28. Looks like they will share some guidance for FY26 as well in next quarter. One more interesting thing mentioned during the call was about the acquisition strategy. They donât want to acquire the full company going forward, only want a majority stake.
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I think it could be due to the amalgamation of ADI BPO into MPS. The share ratio agreed seems to very high
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There is no impact on non-promoter shareholders due to this - its only an internal restructuring within the promoter group with no impact on other shareholders.
These days its very difficult to understand market movements. Despite the muted revenue growth, the profitability even without other income has increased by ~20%. Given the current scenario it is not the worst thing. Additionally, the guidance is again strong for the whole year (numbers will be shared by Q2 hopefully). Acquisitions which form part of the overall business strategy are also expected to be completed within FY26 (as Management virtually confirmed this on concall). Still stock fell ~20% from top.
Compare this many other counters where the profits have virtually halved and still stocks did not fall as much and in some cases, rather increased. I guess liquidity also plays a role here as illiquid counters show both strong up moves and down moves.
Overall, I donât think the results were as bad as the fall in the price. Expect good results in upcoming quarters.
Disc: Biased - holding from a long time
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can any learned member guide why MPS is under free fall. The stock is down 65% since announcement of Q1FY26 results. Is Mr. Market knows something which we donât know. Can they achieve revenue target of 1500 Cr by F28. Expecting same M&A announcements in coming days as per the last concall
Market fears revenue deflation due to AI which impacts terminal value. MPS claims to have AI integrated in their workflows so only growth can prove markets wrong and lead to a re rating. Itâs available at a steal at CMP with a 4.5% yield. M&A and growth can turn around stock price
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Market has reacted positively to Unbound Medicine acquisition. Seems a good acquisition. 16.5 Million USD MPS to pay by 10th Feb for acquisition. Revenue of the target entity
MPS acquisition.pdf (373.6 KB)
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@RajeevJ @Nitya_Shah Request your views on Q3FY26 results and the business for next few years. The selling has been massive since March 2025.
Recovery in FY27, concall he guided for an exceptional year in 2027. I am a believer in the management and continue to hold on. Can give it 2 qtrs more. If Q1 doesnât improve well I will consider exiting.
Anyone see any imapct of Anthropic on MPS?
MPS Ltd is looking like a steal at this price. Any veteran who has understanding of the business please share your viewpoint how much impact they see from Anthropic,s AI engines.
I think their capital allocation is just like symphony of Mozart.
MPS was taken over by the Arora family in October 2011, and the share price at that time was around INR 37 per share, implying a market cap of roughly INR 60 crores.
Since the takeover, the total cash returned to shareholders in the form of dividends is more than INR 220 per share.
Through two buybacks, the management has returned about INR 120 crores in cash to shareholders. Market Cap at takeover time was just 60 crores.
Now, one might expect that the business would not have grown much if so much cash had been distributed, but EPS has still risen from about INR 12 to around INR 100, a CAGR north of 15%.
A large part of this EPS growth has come from nine acquisitions executed by the management over this period.
Most of the business acquired were acquired at cheap valuations because they were in distress. Management turned all of them around and they are in profits. Payback period for some of these businesses was astonishingly small.
You might suspect that, to do all this, management raised a lot of capital and used significant debt; in reality, there has been just one equity issuance and almost zero dependence on debt.
In the end, the stock price CAGR since the takeover has been about 29â31%. Here again, the stock is not excessively valued; it trades at a fairly reasonable multiple of around 20 times earnings.
The level of capital allocation here is comparable to the CEOs profiled in The Outsiders by William Thorndike.
I donât know what label should be applied to the MPS management â serial acquirers, capable operators, or simply exceptionally judicious capital allocators.
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