Porinju Veliyath & Dolly Khanna Forum

Sagility India has strong fundamentals and promising growth prospects over the next one to two years, says Anil Singhvi. Backed by strategic insights and analyst ratings, these recommendation is tailored for investors seeking decent upside of over 50%.

Leading Position in US Healthcare Outsourcing   

Sagility is a major player in the US healthcare outsourcing industry. Its strong domain expertise and long-standing client relationships make it a trusted partner in the sector.

Consistent Operational Performance   

The company has delivered steady operational margins in the range of sixteen to eighteen percent, reflecting efficient cost management and strategic execution.

Impressive Growth Outlook   

Sagility is poised to grow at a compounded annual growth rate (CAGR) of fifty per cent in profit after tax (PAT) over the next three years, supported by rising demand and strategic initiatives.

JP Morgan: Initiated coverage with an "Overweight" rating, setting a target price of Rs 54.

Jefferies: Assigned a "Buy" rating with a target price of Rs 52.

Why Consider Sagility?

The company is well-positioned to capitalise on the increasing demand for healthcare outsourcing services in the US. Its strong fundamentals, coupled with positive analyst ratings, underline its potential for substantial returns.

Investment HorizonThis stock is ideal for investors with a medium- to long-term perspective, aiming to benefit from its anticipated robust growth trajectory.

Sagility's combination of strong operational performance, industry leadership, and favourable growth outlook makes it a compelling choice in the healthcare outsourcing domain.

Sagility's Rally Has More Legs Before Likely February. According to a report in NDTV Profit, the second lock-in period for anchor investors is scheduled to end on Feb. 6.

The rally witnessed in the recently listed Sagility India Ltd. has more legs before the stock will see a temporary setback in February when the second lock-in date for anchor investors will end.

Top brokerages foresee double-digit revenue growth with "structural tailwinds" and "deep domain expertise", which will eventually help trigger the price of the stock.

The counter has rallied by about 75% from its issue price after the company debut on Dalal Street on Nov. 12. Since its muted listing, the stock has seen a stellar surge having ended lower in only 14 sessions so far.

The IT-enabled services firm's shares are on a bullish trajectory and currently trade above the 21-day exponential and 14-day simple moving average. The stock has immediate support near the Rs 45 level and could rally from the current level to the Rs 54 mark, as per JPMorgan.

However, the second lock-in period for anchor investors is scheduled to end on Feb. 6, when institutions could offload the stake they held before the company went public.

Sagility shares may gain even after the lock-in ends if institutions continue to hold on to the stock, similar to how they surged when the first lock-in period ended on Dec. 08.

The stock was locked in the upper circuit on Tuesday after it rose 5% during the day to a life high of Rs 48.93 apiece on the NSE. This compares to a 0.35% advance in the benchmark Nifty 50 as of 10:19 a.m.

The total traded volume so far in the day stood at 1.3 times its 30-day average. The relative strength index was at 82, implying the stock is overbought.

JPMorgan initiated coverage on Sagility with an overweight rating, on prospects of structural tailwinds from rising outsourcing while the company's deep domain expertise and solid client relationships should drive better account mining.

Sagility enjoys attractive structural margins due to a higher offshore mix that should keep margins at the upper end of mid-cap peers, it said. The brokerage forecasts an 18% adjusted earnings CAGR over fiscal 2024-27.

The healthcare payment solutions provider is expected to deliver double-digit revenue growth, according to Jefferies. The brokerage expects revenue to grow at an annualised rate of 11% in dollar terms and 12.5% in rupee terms over fiscal 2025 through 2027, driven by client expansions and scaling new mid-market accounts.

In the September quarter, the company reported a net profit jump by 236% year-on-year. Its consolidated net profit for the reporting quarter came in at Rs 117 crore as against Rs 35 crore in the same quarter a year ago. Revenue rose 21.1% to Rs 1,325 crore and Ebitda was 28.2% higher at Rs 300 crore. Ebitda margin came in at 22.6% as against 21.4%