Buy Datamatics Global Services Ltd for Target Rs.1,130 by Choice Institutional Equities
FY26E Revenue Growth in Mid-Teens; Strategic Investment in AI:
We expect mid-teen FY26 growth driven by strong Digital Operations and the TNQtech acquisition. The company is also scaling AI-led product revenue and plans to invest INR 400–500Mn annually in AI innovation.
View & Valuation: We believe the recent operational initiatives at DATAMATICS are likely to drive improved growth and margin trajectory. We expect the Revenue/EBIT/PAT to expand at 11.8%/ 24.4%/ 16.4% CAGR over FY25–28E. We have re-rated the stock with a revised Target Price of INR1,130 and recommend a BUY rating based on FY27E– FY28E average EPS of INR 51.5, applying a 22x PE multiple.
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SEBI Registration no.: INZ 000160131
