MphasiS hits 52-week high

The stock surged 10% to Rs 552 extending its past two days 7% gain on the BSE.

MphasiS has surged 10% to Rs 552 on the BSE, extending its past two days 7% gain, after operating margin in March 2016 (Q4FY16) quarter expanded by 110 basis points to 14.3% over Q3FY16 and 180 basis points over Q4FY15.

Ganesh Ayyar, chief executive officer & executive director, MphasiS said, FY2017, will see greater predictability and acceleration of business.

Meanwhile, the open offer made by the world's biggest private equity firm, Blackstone Capital Partners to acquire stake in MphasiS begins today.

Blackstone Capital Partners, along with Marble I and Marble II made an open off to purchase up to 54.9 million equity shares or 26% stake in MphasiS at Rs 457.54 a share through tender offer. The offer will close on June 13, 2016.

Prabhudas Lilladher has a ‘buy’ call on the stock with a target price of Rs 570.

“We believe that FY17 will be a year of turnaround for the company with YoY revenue/EBIT/Profit growth after a gap of 3?4 years. Our revenue and margin estimates have upside risk. Special dividend or share?buyback can act as a trigger for the stock. Company is likely to increase the cash return to shareholders under new management,” the brokerage house said in a report.

Blackstone (which acquired HP’s stake in Mphasis) has stated that they will consider share buy?back and special dividend post completion of the open offer process (July 4, 2016), added report.

At 11:13 AM, the stock was up 6% at Rs 533 on the BSE compared to 0.21% decline in the S&P BSE Sensex. The trading volumes on the counter jumped more than three-fold with a combined 589,581 shares changed hands on the BSE and NSE so far.