Mastek (NSEI:MASTEK) - Share price, News & Analysis

MASTEK fundamental analysis
Snowflake Score
Valuation	4/6
Future Growth	4/6
Past Performance	6/6
Financial Health	5/6
Dividends	3/6

MASTEK Stock Overview

Mastek Limited, together with its subsidiaries, provides enterprise technology solutionsin India, the United Kingdom, Europe, the United States, the Middle East, and internationally.

Rewards

Trading at 4% below our estimate of its fair value

Earnings are forecast to grow 17.98% per year

Earnings grew by 41% over the past year

Risk Analysis

Unstable dividend track record

Shareholders have been diluted in the past year

Mastek Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Mastek
Historical stock prices
Current Share Price	₹2,047.25
52 Week High	₹3,669.00
52 Week Low	₹1,850.70
Beta	1.81
1 Month Change	-15.08%
3 Month Change	-32.81%
1 Year Change	-10.04%
3 Year Change	329.60%
5 Year Change	643.10%
Change since IPO	672.55%

Recent News & Updates

Jun 14

With EPS Growth And More, Mastek (NSE:MASTEK) Is Interesting

Some have more dollars than sense, they say, so even companies that have no revenue, no profit, and a record of falling...

May 12

Does Mastek (NSE:MASTEK) Have A Healthy Balance Sheet?

Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously...

Shareholder Returns

	MASTEK	IN IT	IN Market
7D	3.7%	4.4%	2.3%
1Y	-10.0%	-6.1%	-0.9%

Return vs Industry: MASTEK underperformed the Indian IT industry which returned -6.1% over the past year.

Return vs Market: MASTEK underperformed the Indian Market which returned -0.9% over the past year.

Price Volatility

Is MASTEK's price volatile compared to industry and market?
MASTEK volatility
MASTEK Average Weekly Movement	6.9%
IT Industry Average Movement	7.1%
Market Average Movement	6.9%
10% most volatile stocks in IN Market	9.9%
10% least volatile stocks in IN Market	4.5%

Stable Share Price: MASTEK is not significantly more volatile than the rest of Indian stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: MASTEK's weekly volatility (7%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1982	4,977	Hiral Chandrana	https://www.mastek.com

Mastek Limited, together with its subsidiaries, provides enterprise technology solutionsin India, the United Kingdom, Europe, the United States, the Middle East, and internationally. The company offers business and technology services comprising application development, ERP implementation and cloud migration, digital commerce, application support and maintenance, business intelligence and analytics, agile consulting, testing and assurance, and legacy modernization. It also provides data warehousing and enterprise digital transformation services.

Mastek Fundamentals Summary

How do Mastek's earnings and revenue compare to its market cap?
MASTEK fundamental statistics
Market Cap	₹61.41b
Earnings (TTM)	₹2.95b
Revenue (TTM)	₹21.84b

20.8x

P/E Ratio

2.8x

P/S Ratio

Is MASTEK overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
MASTEK income statement (TTM)
Revenue	₹21.84b
Cost of Revenue	₹10.95b
Gross Profit	₹10.88b
Other Expenses	₹7.93b
Earnings	₹2.95b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	98.23
Gross Margin	49.84%
Net Profit Margin	13.51%
Debt/Equity Ratio	15.6%

How did MASTEK perform over the long term?

See historical performance and comparison

Dividends

0.9%

Current Dividend Yield

18%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is MASTEK undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

4/6

Valuation Score 4/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for MASTEK?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for MASTEK. This is calculated by dividing MASTEK's market cap by their current preferred multiple.
What is MASTEK's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	₹61.41b

MASTEK key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.6x
Enterprise Value/EBITDA	11.7x
PEG Ratio	1.2x

Price to Earnings Ratio vs Peers

How does MASTEK's PE Ratio compare to its peers?

MASTEK PE Ratio vs Peers

The above table shows the PE ratio for MASTEK vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	37.2x

Forward PE

Price-To-Earnings vs Peers: MASTEK is good value based on its Price-To-Earnings Ratio (20.8x) compared to the peer average (37.2x).

Price to Earnings Ratio vs Industry

How does MASTEK's PE Ratio compare vs other companies in the Indian IT Industry?

Price-To-Earnings vs Industry: MASTEK is good value based on its Price-To-Earnings Ratio (20.8x) compared to the Indian IT industry average (26.1x)

Price to Earnings Ratio vs Fair Ratio

What is MASTEK's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

MASTEK PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	20.8x
Fair PE Ratio	30.1x

Price-To-Earnings vs Fair Ratio: MASTEK is good value based on its Price-To-Earnings Ratio (20.8x) compared to the estimated Fair Price-To-Earnings Ratio (30.1x).

Share Price vs Fair Value

What is the Fair Price of MASTEK when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: MASTEK (₹2047.25) is trading below our estimate of fair value (₹2132.34)

Significantly Below Fair Value: MASTEK is trading below fair value, but not by a significant amount.

Price to Earnings Growth Ratio

PEG Ratio: MASTEK is poor value based on its PEG Ratio (1.2x)

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Future Growth

How is Mastek forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

18.0%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: MASTEK's forecast earnings growth (18% per year) is above the savings rate (6.7%).

Earnings vs Market: MASTEK's earnings (18% per year) are forecast to grow faster than the Indian market (17.4% per year).

High Growth Earnings: MASTEK's earnings are forecast to grow, but not significantly.

Revenue vs Market: MASTEK's revenue (16.9% per year) is forecast to grow faster than the Indian market (11.5% per year).

High Growth Revenue: MASTEK's revenue (16.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: MASTEK's Return on Equity is forecast to be high in 3 years time (25.5%)

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Past Performance

How has Mastek performed over the past 5 years?

Past Performance Score

6/6

Past Performance Score 6/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

36.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: MASTEK has high quality earnings.

Growing Profit Margin: MASTEK's current net profit margins (13.5%) are higher than last year (12.2%).

Past Earnings Growth Analysis

Earnings Trend: MASTEK's earnings have grown significantly by 36% per year over the past 5 years.

Accelerating Growth: MASTEK's earnings growth over the past year (41%) exceeds its 5-year average (36% per year).

Earnings vs Industry: MASTEK earnings growth over the past year (41%) exceeded the IT industry 38.6%.

Return on Equity

High ROE: MASTEK's Return on Equity (27.3%) is considered high.

Discover strong past performing companies

Financial Health

How is Mastek's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: MASTEK's short term assets (₹15.2B) exceed its short term liabilities (₹8.5B).

Long Term Liabilities: MASTEK's short term assets (₹15.2B) exceed its long term liabilities (₹4.1B).

Debt to Equity History and Analysis

Debt Level: MASTEK has more cash than its total debt.

Reducing Debt: MASTEK's debt to equity ratio has increased from 13.9% to 15.6% over the past 5 years.

Debt Coverage: MASTEK's debt is well covered by operating cash flow (143.5%).

Interest Coverage: MASTEK's interest payments on its debt are well covered by EBIT (57.8x coverage).

Balance Sheet

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Dividend

What is Mastek current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

0.93%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: MASTEK's dividend (0.93%) is higher than the bottom 25% of dividend payers in the Indian market (0.43%).

High Dividend: MASTEK's dividend (0.93%) is low compared to the top 25% of dividend payers in the Indian market (1.89%).

Stability and Growth of Payments

Stable Dividend: MASTEK has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: MASTEK's dividend payments have increased, but the company has only paid a dividend for 9 years.

Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (17.8%), MASTEK's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (24.1%), MASTEK's dividend payments are well covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

1.3yrs

Average management tenure

CEO

Hiral Chandrana

0.92

Tenure

Mr. Hiral Chandrana is Investment Committee Member of Propellant Ventures. Mr. Chandrana serves as the Global Chief Executive Officer at Mastek Limited since July 6, 2021. He serves as an Advisor at Tercer...

Leadership Team

Experienced Management: MASTEK's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.

Board Members

Experienced Board: MASTEK's board of directors are not considered experienced ( 2 years average tenure), which suggests a new board.

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: MASTEK insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 18.9%.

Data	Last Updated (UTC time)
Company Analysis	2022/06/25 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31