Execution issues, margin pressure to cap Mindtree's gains from new strategy

Valuations too leave little upside from current levels

Bengaluru-based IT service company Mindtree, which recently outlined its new growth strategy, is targeting industry leading growth with a focus on large deal wins, mining strategic accounts, seamless delivery and strengthening its partner ecosystem. The management announced its intentions to enter the healthcare vertical and strengthen its existing consulting practice. Mindtree also indicated that it is open to considering the M&A route to accelerate growth, a significant change from the past. This is seen as a positive by analysts as they believe this will widen the company’s growth profile. There are, however, concerns surrounding execution and potential margin pressure from