NSEI:MASTEK

Stock Analysis Report

Executive Summary

Mastek Limited, together with its subsidiaries, provides enterprise technology solutions.


Snowflake Analysis

Very undervalued with excellent balance sheet and pays a dividend.

Share Price & News

How has Mastek's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: MASTEK's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-15.9%

MASTEK

2.1%

IN IT

-2.9%

IN Market


1 Year Return

-61.2%

MASTEK

-15.1%

IN IT

-29.3%

IN Market

Return vs Industry: MASTEK underperformed the Indian IT industry which returned -15.3% over the past year.

Return vs Market: MASTEK underperformed the Indian Market which returned -29.2% over the past year.


Shareholder returns

MASTEKIndustryMarket
7 Day-15.9%2.1%-2.9%
30 Day-58.5%-18.1%-26.5%
90 Day-57.4%-18.5%-28.5%
1 Year-59.4%-61.2%-12.5%-15.1%-27.9%-29.3%
3 Year2.3%-5.0%35.7%27.3%-15.4%-20.0%
5 Year-54.8%-59.3%31.0%18.5%-3.3%-8.3%

Price Volatility Vs. Market

How volatile is Mastek's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Mastek undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: MASTEK (₹172.15) is trading below our estimate of fair value (₹432.05)

Significantly Below Fair Value: MASTEK is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: MASTEK is good value based on its PE Ratio (4x) compared to the IT industry average (7x).

PE vs Market: MASTEK is good value based on its PE Ratio (4x) compared to the Indian market (9.2x).


Price to Earnings Growth Ratio

PEG Ratio: MASTEK is good value based on its PEG Ratio (0.3x)


Price to Book Ratio

PB vs Industry: MASTEK is good value based on its PB Ratio (0.5x) compared to the IN IT industry average (0.7x).


Next Steps

Future Growth

How is Mastek forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

12.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MASTEK's forecast earnings growth (12.3% per year) is above the savings rate (6.5%).

Earnings vs Market: MASTEK's earnings (12.3% per year) are forecast to grow slower than the Indian market (19.8% per year).

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

Revenue vs Market: MASTEK's revenue (18.7% per year) is forecast to grow faster than the Indian market (9.1% per year).

High Growth Revenue: MASTEK's revenue (18.7% 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 low in 3 years time (14.1%).


Next Steps

Past Performance

How has Mastek performed over the past 5 years?

34.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MASTEK has high quality earnings.

Growing Profit Margin: MASTEK's current net profit margins (10.2%) are higher than last year (9.4%).


Past Earnings Growth Analysis

Earnings Trend: MASTEK's earnings have grown significantly by 34.6% per year over the past 5 years.

Accelerating Growth: MASTEK's earnings growth over the past year (9.4%) is below its 5-year average (34.6% per year).

Earnings vs Industry: MASTEK earnings growth over the past year (9.4%) exceeded the IT industry 7.2%.


Return on Equity

High ROE: MASTEK's Return on Equity (12.5%) is considered low.


Next Steps

Financial Health

How is Mastek's financial position?


Financial Position Analysis

Short Term Liabilities: MASTEK's short term assets (₹5.2B) exceed its short term liabilities (₹1.6B).

Long Term Liabilities: MASTEK's short term assets (₹5.2B) exceed its long term liabilities (₹1.0B).


Debt to Equity History and Analysis

Debt Level: MASTEK's debt to equity ratio (8.2%) is considered satisfactory.

Reducing Debt: MASTEK's debt to equity ratio has increased from 0.01% to 8.2% over the past 5 years.

Debt Coverage: MASTEK's debt is well covered by operating cash flow (157.3%).

Interest Coverage: MASTEK earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: MASTEK has a low level of unsold assets or inventory.

Debt Coverage by Assets: MASTEK's debt is covered by short term assets (assets are 7.7x debt).


Next Steps

Dividend

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

4.64%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MASTEK's dividend (4.64%) is higher than the bottom 25% of dividend payers in the Indian market (0.95%).

High Dividend: MASTEK's dividend (4.64%) is in the top 25% of dividend payers in the Indian market (4.18%)


Stability and Growth of Payments

Stable Dividend: MASTEK's dividend payments have been volatile in the past 10 years.

Growing Dividend: MASTEK's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (18.8%), MASTEK's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MASTEK's dividends in 3 years are forecast to be well covered by earnings (18.3% payout ratio).


Next Steps

Management

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

3.4yrs

Average management tenure


CEO

John Owen

3.33s

Tenure

Mr. John Timothy Owen has been Group Chief Executive Officer at Mastek Limited and Mastek (UK) Ltd. Mr. Owen has been Group Chief Executive Officer of Mastek Inc. since February 9, 2017. He serves as Vice  ...


Leadership Team

NamePositionTenureCompensationOwnership
Sudhakar Ram
Vice Chairman & MD3.33yrs₹9.42m7.21% 302.0m
Abhishek Singh
Group Chief Financial Officer3.5yrs₹25.22m0.23% 9.5m
Dinesh Kalani
Compliance Officer & Company Secretary4.5yrs₹3.60mno data
John Owen
Group Chief Executive Officer3.33yrsno datano data
Joe Venkataraman
Group Corporate Development Officerno data₹15.03mno data
Maninder Puri
Group Chief Human Resources Officer2.58yrsno datano data
William McCarter
Senior Vice President of Delivery of North Americano datano datano data
David Chamberlain
Delivery Unit Head of BT & Healthno datano datano data
Mike Andrews
Senior Vice President of Strategic Accountsno datano datano data
Sunil Subhedar
Head of Systems Groupno datano datano data

3.4yrs

Average Tenure

46yo

Average Age

Experienced Management: MASTEK's management team is considered experienced (3.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Sudhakar Ram
Vice Chairman & MD3.33yrs₹9.42m7.21% 302.0m
Joe Venkataraman
Group Corporate Development Officerno data₹15.03mno data
Ashank Desai
Co-Founder & Non-Executive Director37.75yrs₹2.29m13.1% 548.3m
Srinivasan Sandilya
Non-Executive Chairmanno data₹3.20m0.11% 4.5m
Priti Rao
Independent Non-Executive Director9.17yrs₹2.50m0.12% 5.1m
Rajeev Grover
Independent Director0.17yrno datano data
Atul Kanagat
Independent Non-Executive Director7.17yrs₹1.40m0.040% 1.7m

7.2yrs

Average Tenure

64yo

Average Age

Experienced Board: MASTEK's board of directors are considered experienced (7.2 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Mastek Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Mastek Limited
  • Ticker: MASTEK
  • Exchange: NSEI
  • Founded: 1982
  • Industry: IT Consulting and Other Services
  • Sector: Software
  • Market Cap: ₹4.186b
  • Shares outstanding: 24.29m
  • Website: https://www.mastek.com

Number of Employees


Location

  • Mastek Limited
  • #106, SDF IV
  • Seepz
  • Mumbai
  • Maharashtra
  • 400096
  • India

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
523704BSE (Mumbai Stock Exchange)YesEquity SharesININRMay 1995
MASTEKNSEI (National Stock Exchange of India)YesEquity SharesININRMay 1995

Biography

Mastek Limited, together with its subsidiaries, provides enterprise technology solutions. It provides business and technology services comprising application development, business intelligence and analytics, digital commerce, application support and maintenance, testing and assurance, agile consulting, and legacy modernization. The company also provides data warehouse, system integration, and enterprise digital transformation services. It serves customers in various sectors, such as retail, financial services, healthcare, and public-sector businesses in India, the United Kingdom, and the United States. Mastek Limited was founded in 1982 and is based in Mumbai, India. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 13:12
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.