There will never be a threat of hostile takeover in Happiest Minds: Happiest Minds

There will never be a threat of hostile takeover in Happiest Minds: Happiest Minds

Update on the Indian Equity Market:
On Friday, NIFTY closed in minor red at 11,505 (-0.1%). The top gainers in NIFTY50 were Dr Reddy (+9.9%), Cipla (+7.1%) and Adani Ports (+3.7%). The top losers were HDFC Bank (-2.3%), Shree Cement (-2.0%), and Bajaj FInserv (-1.8%). The top sectoral gainers were PHARMA (+4.9%), REALTY (+1.9%) and AUTO (+0.4%) and Top sectoral losers were PSU BANK (-1.6%), BANK (-1.3%), and FIN SERVICES (-1.2%)

Excerpts of an interview with Mr Ashok Soota, Chairman & Director, Happiest Minds with ET now dated 18th September 2020:
● He wanted to make a distinction between what is a broader IT services market and the digital part of the IT services market.
● They are born digital, born agile, 97% of their business comes from digital and the traditional IT market is growing much smaller and that is why they are able to grow at a faster rate — a compound of 20% plus as compared to about 8% to 10% for the larger IT players today.
● IT services business is growing, it is the entire market typically and slowdowns and recessions and more so in this one where everything is becoming virtual, IT will definitely grow faster within that. The transformation towards digital will also get accelerated.
● Their largest and fastest-growing vertical is edutech. How that is going to benefit from this environment because everything is becoming virtual.
● The other vertical in which they have got a very strong presence is the rest of the high tech world. Again because it is a core competence at Happiest Minds, two of them account for 76% of their business which has been only marginally or not impacted by the COVID crisis.
● The other 24% has been affected but fortunately, they have got a very marginal presence in travel and hospitality which is the worst impacted vertical and therefore they have to continue to build on the strengths that they have.
● When they began Happiest Minds, they were in what was called a SMACK pack which included analytics and cloud after that they have added over the years the internet of things, machine learning, virtual and augmented reality and so on.
● Going forward, I do not want to speculate on whether my shares will go up or go down if they raise more equity obviously, but there are no immediate plans to do so.
● Whatever happens, they will keep one thing in mind that there will never be a threat in the sense of ownership which could create a hostile acquisition situation.

Consensus Estimate: (Source: market screener and websites)

● The closing price of Happiest Minds was ₹ 358/- as of 18-September-2020.
● Equity shares of Happiest Minds Technologies Ltd are listed effective from September 17, 2020. So we don’t have any consensus estimates.

Disclaimer: “The views expressed are for information purposes only. The information provided herein should not be considered as investment advice or research recommendation. The users should rely on their own research and analysis and should consult their own investment advisors to determine the merit, risks, and suitability of the information provided.”

Share this post

Leave a Reply

Your email address will not be published. Required fields are marked *