MphasiS jumps on buzz HP may sell stake

MphasiS rose 4.65% to Rs 439 at 15:07 IST on BSE on reports that promoter company Hewlett-Packard has revived plans to sell its stake in the Indian company.

Meanwhile, the BSE Sensex was up 331.42 points, or 1.30%, to 25,847.77.

On BSE, so far 1.71 lakh shares were traded in the counter, compared with an average volume of 17,097 shares in the past one quarter.

The stock hit a high of Rs 464.90 and a low of Rs 430 so far during the day. The stock hit a 52-week high of Rs 465.45 on 3 October 2013. The stock hit a 52-week low of Rs 361.95 on 3 July 2013.

The stock had underperformed the market over the past one month till 1 July 2014, falling 3.89% compared with 5.36% rise in the Sensex. The scrip had also underperformed the market in past one quarter, rising 3.79% as against Sensex's 13.68% rise.

The mid-cap company has an equity capital of Rs 210.15 crore. Face value per share is Rs 10.

According to reports, Hewlett-Packard (HP), the majority owner of MphasiS, has revived plans to sell its stake in the Bangalore-based listed information technology services company with a recovery in the stock market.

HP has reportedly given UBS the job of finding a suitor for MphasiS. As on 31 March 2014, HP held 60.49% in MphasiS.

Infotech companies and private equity players have shown interest in buying Hewlett-Packard's stake in MphasiS, reports suggested. Prominent among these are Japanese technology companies NEC and Fujitsu.

Hewlett-Packard is not only MphasiS' promoter, it is also its largest client. But the HP channel business has been on a decline. The revenue mix between the company's direct business and that sourced through HP has changed significantly to 64:36 in the quarter ended March 2014 from 54:46 in the quarter ended March 2013.

On a consolidated basis, MphasiS' net profit fell 32.40% to Rs 122.08 crore on 34.15% decline in net sales to Rs 1029.86 crore in the quarter ended March 2014 over the quarter ended January 2014.

MphasiS is a leading IT solutions provider, offering applications, business process outsourcing (BPO) and infrastructure services globally through a combination of technology knowhow, domain and process expertise.

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