Happiest Minds reiterates guidance and expects M&A in next two months
Happiest Minds Technologies hopes to hit $1 billion in sales by 2031 backed by growth in the recently-launched Generative Artificial Intelligence business and acquisitions.
Bengaluru-based digital solutions provider Happiest Minds Technologies on December 19 reiterated its organic growth guidance of 12% and margin guidance of 22-24% for the financial year 2024.
Venkatraman Narayanan, the company's Managing Director and CFO, and Joseph Anantharaju, Executive Vice Chairman and CEO of Product Engineering Services, shared insights into the company's plans to achieve the target $1 billion in revenues by 2031.
Anantharaju said there is a lot of action in the generative artificial intelligence (Gen AI) business that the company set up a few months ago. Over the next five years, the company is targeting revenue contribution of at least 20% from this business.
The second important driver will be inorganic growth. Anantharaju said that while the company is aggressively pursuing some deals there seems to be hesitation among companies to strike a deal immediately as they hope for better valuations and offers as the overall deal environment improves. Nevertheless, he hopes to close a deal in the next couple of months.
The company's last acquisition was in January 2023, when it bought Madurai-based IT services firm Sri Mookambika Infosolutions (SMI) for ₹111 crore.
Headwinds in the organic business over the last six months led Happiest Minds to lower its full-year growth guidance for the business to 12% from 15-20% projected earlier post the second quarter earnings.
The company was earlier expecting a 25% growth in the overall business including organic growth plus potential acquisitions.
The company's consolidated profit for the September quarter fell 1.6% to ₹58.46 crore from the year-ago period. Revenue was up 19.3 year-on-year (YoY) ₹428.83 crore.
Happiest Minds Technologies that listed on the exchanges at ₹351 apiece versus the IPO issue price of ₹166 had a solid run for a long time. The stock is currently around 41% down from its all-time high of ₹1,580. Its market capitalisation is around ₹14,233 crore.
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(Edited by : Shweta Mungre)
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