Mphasis Ltd: In-Line Operating Performance Across Verticals

BUY

CMP: Rs2276  |

Target Price: Rs2800

* Mphasis delivered in-line operating performance in Q1. Gross revenue grew by 1.2% QoQ to USD435.9mn, reflecting some growth moderation due to the weakness in the mortgage and Europe businesses, though it came in broadly in line with our expectations. EBITM expanded by 10bps QoQ to 15.3%, 10bps above our estimate.

* Direct segment revenues grew 5.0% QoQ (2.4% CC) to Rs31.7bn. Broad-based demand, healthy new-deal wins (USD302mn in Q1) and a robust deal pipeline should help sustain revenue growth. Management is confident of sustaining healthy growth in Direct in FY23.

* DXC revenues declined by 4.4%/34.6% QoQ/YoY (CC 6.7%/36.7%) to ~Rs1.6bn. The company expects increasing convergence of overall revenue growth with that of Direct going forward, as the share of DXC revenue falls below mid-single digits.

* We cut FY23/FY24/FY25E EPS by 0.7%/1.5%/1.4%, factoring in the Q1 performance. The weakness in the mortgage business should weigh on near-term revenue growth trajectory. We maintain Buy with a TP of Rs2,800 (25x Jun'24E EPS), considering continued wallet share gains and a steady expansion in addressable markets with competency build-up.

SAP Labs India Establishes Centre For Digital Government In Partnership With NeGD, Government Of India

* Signs MoU with NeGD to work together on Capacity Building, Innovations in Public Service Delivery and Thought Leadership — SAP Labs

India has announced partnership with National e-Governance Division (NeGD), Ministry of Electronics and Information Technology (MeitY), Government of India, to improve the digital government capabilities in India. The SAP Centre for Digital Government (SCDG) was inaugurated by Shri Abhishek Singh, President & CEO, NeGD, MeitY and Ms. Sindhu Gangadharan, SVP & MD, SAP Labs India, in the presence of senior officials from NeGD and SAP. SAP Labs India will work closely

with NeGD to set up the SCDG Knowledge Centre in Bengaluru, India. The Centre would focus on capacity building, program management, and implementation of Digital India’s projects and initiatives undertaken by ministries and departments at the central and state levels.  

As part of the MoU, SCDG would cater to three broad pillars of activities: innovations in technology application for government service delivery, capacity

building and knowledge sharing, and thought leadership. Activities would also include policy consultations to support the realization of the aforementioned for the benefit of the Indian Public Service and sectors across all levels of government. 

On the occasion, Shri Abhishek Singh, President & CEO-NeGD, said, “The potential and application of technology for an inclusive growth has been a game changer for India. To leapfrog further, cross-stakeholder industry-government collaboration is becoming more important than ever. The collective initiative of National e-Governance Division and SAP will support innovation and capacity building to enable the next wave of Digital India’s inclusive and transformational initiatives.”  

Sindhu Gangadharan, SVP & MD, SAP Labs India, said, “SAP Centre for Digital Government (SCDG), established in partnership with NeGD, aims to promote the adoption

of technology-based solutions in India’s Public Service Sector through specially curated digital upskilling programs for public /government officials. At SCDG, our technology experts will directly engage with public service professionals to provide strategic  mentorship and will conduct training programs, workshops/roundtables and innovation showcases. SAP is committed to driving the innovation agenda in India, and the latest initiative further reinforces our efforts towards enabling digital transformation and journey towards sustainable growth.” 

“With the fast-paced digital technology developments, Governments now have the dual role of creating an enabling ecosystem as well as adopting technologies for public services. At SAP, we have been privileged to partner with the Indian Government to co-innovate digital solutions for larger public good and collaborate on capacity building to ensure adoption and use. Through the SAP Centre for Digital Government in partnership with the National e-Governance Division, Ministry of Electronics and Information Technology, we look forward to creation of a platform for multi-stakeholder engagement to support the ambition of a digitally intelligent India,” said Dr. Lovneesh. 

To make the collaboration as effective as possible, SCDG will conduct regular training programs for government officials to build their technical and digital skills for enabling ease of living for citizens; thus, trained officials can accelerate the e-governance adoption. SCDG will also work with government ministries, such as the Ministry of Electronics and Information Technology (MeitY), Ministry of Commerce  and Industry and Ministry of Education, to ensure longer-term achievement of the desired impact, and in so doing, address the needs of all central and state government digitization requirements. 

About SAP

SAP’s strategy is to help every business run as an intelligent, sustainable enterprise. As a market leader in enterprise application software, we help companies of all sizes and in all industries run at their best: SAP customers generate 87% of total global commerce. Our machine learning, Internet of Things (IoT), and advanced analytics technologies help turn customers’ businesses into intelligent enterprises. SAP helps give people and organizations deep business insight and fosters collaboration that helps them stay ahead of their competition. We simplify technology for companies so they can consume our software the way they want – without disruption. Our end-to-end suite of applications and services enables business and public customers across 25 industries globally to operate profitably, adapt continuously, and make a difference. With a global network of customers, partners, employees, and thought leaders, SAP helps the world run better and improve people’s lives. For more information, visit www.sap.com.  

Atlassian Hires Meta’s Former Head of Engineering Rajeev Rajan As Its New CTO

Atlassian Corporation Plc (NASDAQ: TEAM), a leading provider of team collaboration and productivity software and the maker of Jira, Confluence, Bitbucket, and Trello, has appointed Rajeev Rajan as its new Chief Technology Officer (CTO). Based in Washington state in the Pacific Northwest region of the U.S., Rajeev joins Atlassian with close to three decades of experience building and leading teams at pioneering global technology companies including Meta and Microsoft. 

In his new role as Chief Technology Officer at Atlassian, Rajeev will lead and support all the Engineering, IT, Trust and Security teams across the globe. This key leadership hire is set to play an important role in setting strategy and steering Atlassian on its path of accelerated growth. 

The India-born executive brings a wealth of knowledge and experience in scaling global technology companies, having spent nearly five years at Meta, most recently as Vice President and Head of Engineering for Facebook and Head of Meta for the Pacific Northwest region. Prior to that, Rajeev had a career spanning 23 years at Microsoft working across multiple products from Exchange to SQL Server to Active Directory, culminating in Office 365. 

Speaking about his new role, Rajeev Rajan, CTO, Atlassian said, “As I looked at the next step in my career, the set of learnings and experiences I wanted to have, and where I could be most helpful, the CTO role at Atlassian excited me. As someone who has spent their entire career building and leading software teams, Atlassian's mission to unleash the potential of every team through collaboration and productivity software really resonated with me. 

“Over the next few years, we are tripling our engineering team and I believe Atlassian has the potential to become one of the top engineering teams in the world. I’m excited to put systems in place that will ensure we stand the test of time, preserve the unique Atlassian spirit, and welcome new employees from all parts of the world.” 

Rajeev has completed a master's degree in Computer Science from The Ohio State University and also spent a year in graduate school in the Computer Science program at the University of Illinois Urbana-Champaign. He has also completed a B.E. (Hons.), in Computer Science at the Birla Institute of Technology and Science, Pilani. 

About Atlassian

Atlassian unleashes the potential of every team. Our team collaboration and productivity software helps teams organize, discuss and complete shared work. Teams at more than 230,000+ customers, across large and small organizations – including Bank of America, Redfin, NASA, Verizon, and Dropbox – use Atlassian’s project tracking, content creation and sharing, and service management products to work better together and deliver quality results on time. 

Learn more about our products, including Jira Software, Confluence, Jira Service Management, Trello, Bitbucket, and Jira Align at Atlassian | Software Development and Collaboration Tools 

Gokaldas Exports Reports PAT Of Rs 50.8 Crore Compared To Rs 52.4 Crore In Previous Quarter

Financial Results, Q1 FY23

Gokaldas Exports Limited today declared its financial results for the quarter ended 30th June 2022. For the quarter, the Company reported a revenue of Rs 612.7 Crore on a consolidated basis, up by 152% compared to a Covid impacted revenue of Rs 243 Crore in the corresponding quarter of last year. The company has made appreciable progress across all key performance indicators.

Key Highlights:

o   Profit before tax was Rs 50.8 Crore compared to a loss Rs.2.6 Crore in Q1 FY22 and Rs 52.4 Crore in the previous quarter, Q4 FY22. During quarter the company considered share-based compensation charge of Rs 6 Crore, excluding which the profit before tax was Rs 56.8 Crore.

o   Reported a net profit of Rs 39.4 Crores in the current quarter and generated an EBITDA of Rs 74.3 Crore compared to Rs 19.9 Crore in the Q1 FY22.

o   During the quarter, the company has incurred a CapEx of Rs 32 Crore towards capacity expansion and modernisation.

Commenting on the company’s performance, Mr. Siva Ganapathi, Managing Director, said, the solid revenue and profit growth was driven by excellence in execution and utilizing the capacity optimally in a challenging economic environment.

The company will continue to focus on optimal resource utilization and drive operational excellence.

Godrej & Boyce Targets 35% Growth In Its Commercial Aviation Business

* Improving infrastructure and government thrust coupled with the travel pick-up, has geared the demand for aerospace components and parts

* Godrej Aerospace is targeting 3 times growth in 3 years 

Godrej & Boyce, the flagship company of the Godrej Group, has stated that its business Godrej Aerospace is targeting a 35% growth in its Civil Aviation business. This is owing to the 50% surge in demand that has been witnessed in this segment, from global majors including OEMs and engine manufacturers. With domestic travel having recovered globally and with international travel scheduled to reach pre-covid levels by 2025, the demand for civil aviation is accelerating. The business is further eyeing three times growth by FY25 owing to the rising demand for aerospace components and parts as travel trends lift. 

The Business announced that technology expansion along with increasing global presence will drive this growth.  This projected growth is also fuelled by major engine manufacturers and global OEMs taking a keen interest in India. Catering to the current demand, Godrej Aerospace is seen as a preferred partner owing to the integrated manufacturing facility backed by capability and approvals that the Company has in the aviation industry for over a decade. Godrej Aerospace has been manufacturing and supplying complex airworthy systems for aircraft applications, including critical sheet metal brackets, complex fabrications, hydraulic aggregates, crash-proof fuel tanks for helicopters, structural assemblies, and many other products for key global partners. The business is AS9100 certified and NADCAP approved for special processes like chemical processes, welding, heat treatment & brazing, NDT, composites, elastomer seals, measurement and inspection and non-conventional machining. Godrej Aerospace has been partnering with ISRO for over 30 years to manufacture complex systems such as the liquid propulsion engines for PSLV and GSLV rockets, thrusters for satellites, and antenna systems.

Maneck Behramkamdin, AVP & Business Head, Godrej Aerospace said, “The aviation sector working towards recovering from a severe economic crisis, is now exhibiting indications of confidence. Global OEMs are opening avenues for partnering with Indian manufacturers. Considering the post-pandemic economic recovery, we are projecting three times growth in the next three years in the civil aviation segment and expect this to revive further.”

About Godrej & Boyce Mfg. Co. Ltd

Godrej & Boyce ('G&B'), a Godrej Group Company, was founded in 1897 and has contributed to India's journey of self-reliance through manufacturing. G&B patented the world's first springless lock and since then, has diversified into 14 businesses across various sectors from Security, Furniture, and Aerospace to Infrastructure and Defence. Godrej is one of India's most trusted brands serving over 1.1bn customers worldwide daily.

To learn more visit: www.godrej.com

Bank of Baroda Organises “Banking Beyond Tomorrow – Annual Banking Conference 2022”

* The RBI Governor, Shri Shaktikanta Das is the Chief Guest at the conference 

Bank of Baroda (Bank), one of India’s leading public sector banks, organised the first edition of its Annual Banking Conference with the theme being “Banking Beyond Tomorrow”. Shri Shaktikanta Das, Governor, Reserve Bank of India was the Chief Guest at the conference and delivered the inaugural address.  

With over 20 eminent speakers from within the banking and financial services industry and outside, the full-day conference features five stimulating and thought-provoking panel discussions covering Banking Beyond Tomorrow; New Frontiers in Financial Inclusion; Innovative Technologies and New Business Models for Digital Banking; ESG Finance and Tackling Climate Change, and ending with an Economists’ Roundtable.  

Shri Sanjiv Chadha MD & CEO, Bank of Baroda said, “As we step into the post-Covid-19 era, we have the opportunity to debate on longer-term trends and steer the discussion towards identifying the contours of Banking Beyond Tomorrow. The other aspect that we have learnt over the last few years is that banks cannot do everything theMs.elves. They need to work with partners - partners who are increasingly embedded in core banking areas. The conference is therefore all about an outside-in perspective, and how we can define and shape the future of banks.” 

The notable highlight of the event was RBI Governor’s inaugural address. He spoke about the macroeconomic backdrop, noting that India’s growth remains strong. He also mentioned that RBI will take adequate steps to ensure a ‘soft landing’ for the Indian economy. Notably, he defended the flexible inflation targeting approach of the MPC, highlighting that it ensures the stability of the overall ecosystem. He also noted that RBI is well positioned to weather any external shocks. He mentioned that spillovers from global policy tightening, ongoing geopolitical tensions, Covid-19 induced slowdown, and commodity price shock have impacted growth across economies. To reiterate India’s strong external position, the RBI Governor stated that unhedged ECBs account for only a small portion of the total debt, hence India is adequately insulated against foreign exchange risk. 

On the regulatory front, the Governor pointed out that good governance and a sound risk management framework is essential for an efficient and well-functioning banking system. He emphasised how social media can increase customer penetration and used a tool for grievance redressal. He also flagged the need to recognise climate-related risks and incorporate them into business models.  

The theme of the first session was Banking Beyond Tomorrow. Eminent panellist Ms. Arundhati Bhattacharya, Salesforce India raised an important point and suggested the need for creating end-to-end digital products. She also mentioned the need for automation of services for the efficient functioning of the entire banking system. Mr. Ashish Gupta, Credit Suisse said that customer activities should be through regulated entities to ensure KYC compliance and customer safety. Mr. Deep Gupta, Macquarie Asset Management noted that technology and green infrastructure are two of the most important emerging areas of financing. Mr. Rashesh Shah, Edelweiss Group opined that banks in the future will transform into hubs providing financial solutions.  

Mr. Dilip Asbe from NPCI who joined the conference through video conferencing, in a fireside chat with Mr. Akhil Handa, Bank of Baroda highlighted the importance of digital infrastructure. He noted the success of UPI in the payment infrastructure. He also highlighted that rural will lead the way in the digital payment space growing at a 2x-4x pace.  

The next session focused on financial inclusion. Answering the question of strengthening the movement of financial inclusion, panellist Mr. Amit Arora of World Bank’s suggestion was to collectively invest in 1) customer protection and grievance redressal and 2) financial health of households. Mr. Vikramaditya Singh Khichi of Bank of Baroda said that the Bank is punching much above its weight with a 15% share in PMJDY and the Bank is working on more products to further penetrate the rural and Agri markets. bob World already has onboarded over 20 million customers. Ms. Kalpana Ajayan, Women’s World Banking emphasised the need to focus on advocacy, gender-sensitive policies and making women more comfortable with technology. Ms. Sucharita Mukherjee and Kaleidofin spoke about the importance of account aggregators providing tailored credit solutions. Mr. Anil Gupta, MicroSave Consulting, the moderator, ended the session by stating that it is time to move from Jan Dhan to Jan SaMr.idhhi.  

A special address was delivered by Mr. Harsh Wardhan Modi from J.P. Morgan through video conferencing. He pointed out that in the current scenario, inflation is sticky and global interest rates will remain high. Banks with the best total cost-to-asset ratio will gain long-term shares. Furthermore, in terMs. of digitisation, he highlighted that customer experience is becoming a prime driver of value creation in financial services. On cryptocurrencies, he pointed out that regulatory buy-in will be necessary for any form of money and payment system to gain scale.  

The next session shed light on innovative technologies and new business models for digital banking. In this session, moderated by Bank of Baroda’s Chief Digital Officer, Mr. Akhil Handa, the conversation revolved around solutions-based services to enhance the digital outreach in the banking sector. Mr. Ajay Khurana, Bank of Baroda mentioned that micro-service-based architecture is better for enhanced customer experience. Further, he noted that Bank of Baroda’s data lake is ushering in new dimensions of analytics. Ms. Lizzie Chapman, ZestMoney spoke about complementarity between technology companies and banks wherein banks will bring stability and regulatory awareness. Pranav Arora, Accenture said that Open Banking is indeed a massive opportunity for all banks. Ms. Chetna G Sinha of Mann Deshi Bank agreed and further stated that the rural population is eager for digital financial solutions and that banks should pave the way.  

Tata Motors Bags Prestigious Order of 1500 Electric Buses From Delhi Transport Corporation Under The CESL Tender

 

Key Highlights:

* Largest order to date for electric buses by Delhi Transport Corporation

* Tata Motors will supply, operate and maintain 1500 air-conditioned, low-floor 12-metre electric buses

* Tata Starbus electric buses offer state-of-the-art technology and features designed for comfortable travel for passengers

Tata Motors, India’s largest commercial vehicle manufacturer, today announced that it has bagged a prestigious order of 1500 electric buses from Delhi Transport Corporation (DTC) under the larger tender by Convergence Energy Services Limited. Tata Motors will supply, operate and maintain air-conditioned, low-floor, 12-metre fully built electric buses for 12 years, as per the contract. Tata Starbus electric buses offer state-of-the-art technology for sustainable, eco-friendly and economical public transportation and are equipped with modern features to enable safe, smooth and comfortable travel for passengers.

Commenting on the occasion, Mr. Neeraj Semwal, IAS, MD – Delhi Transport Corporation, said, “We are delighted to confirm the order of 1500 electric buses to Tata Motors. The induction of the environment-friendly buses will help largely in reducing air pollution and benefit millions of Delhi citizens. DTC remains committed to introducing new technologies for benefit of passengers and society, at large.”

Ms. Mahua Acharya, MD & CEO Convergence Energy Services Limited (CESL) said, “We are extremely happy that DTC has placed its largest order for electric buses under the Grand Challenge of CESL. The Delhi Government has shown exemplary leadership in transitioning over to electric buses. We are fortunate to have benefited from this and are thankful to Tata Motors in their generous collaboration.”

On the momentous occasion, Mr. Rohit Srivastava, Vice President, Product Line – Buses, Tata Motors, said, “We’re delighted to have won the largest order for electric buses by DTC. The delivery of these buses will further fortify our partnership with DTC and help in environment-friendly mass mobility for the city of Delhi. We are committed towards modernising public transportation in India and keep sustainability at the core in the designing of futuristic vehicles.”

Tata Motors has been at the forefront of bringing environment-friendly mobility to India. Its state-of-the-art research and development facilities have steadily worked to engineer innovative solutions powered by alternate fuel technology, including battery-electric, hybrid, CNG, LNG and hydrogen fuel cell technology. Till date, Tata Motors has supplied more than 650 electric buses across multiple cities in India, which have cumulatively clocked more than 39 million kilometres.

About Tata Motors

Part of the USD 109 billion Tata group, Tata Motors Limited (NYSE: TTM; BSE: 500570 and 570001; NSE: TATAMOTORS and TATAMTRDVR), a USD 34 billion organization, is a leading global automobile manufacturer of cars, utility vehicles, pick-ups, trucks and buses, offering extensive range of integrated, smart and e-mobility solutions. With ‘Connecting Aspirations’ at the core of its brand promise, Tata Motors is India’s market leader in commercial vehicles and amongst the top three in the passenger vehicles market.

Tata Motors strives to bring new products that fire the imagination of GenNext customers, fueled by state of the art design and R&D centers located in India, UK, US, Italy and South Korea. With a focus on engineering and tech enabled automotive solutions catering to the future of mobility, the company’s innovation efforts are focused to develop pioneering technologies that are sustainable as well as suited to evolving aspirations of the market and the customers. The company is pioneering India's Electric Vehicle (EV) transition and driving the shift towards sustainable mobility solutions by preparing a tailor-made product strategy, leveraging the synergy between the Group companies and playing an active role liasoning with the Government in developing the policy framework.

With operations in India, the UK, South Korea, Thailand, South Africa and Indonesia, Tata Motors’ vehicles are marketed in Africa, Middle East, South & South East Asia, Australia, South America, Russia and other CIS countries. As of March 31, 2022, Tata Motors’ operations include 86 consolidated subsidiaries, two joint operations, four joint ventures and 10 equity-accounted associates, including their subsidiaries, in respect of which we exercise significant influence.