Acquisition leaves much to be desired; UPF

研报英文原文证据摘录

Acquisition leaves much to be desired; UPF

India | Computer Services & IT Consulting

LTM EquityMayResearch22, 2026

TARGET CHANGEAcquisition leaves much to be desired; UPF

The US$185m acquisition of Randstad's tech services business will help RATING UNDERPERFORM

LTM diversify into Europe & Australia, adds 15+ clients across Aero/ PRICE INR4,128.55^

Defense/Auto/Utility and BFS verticals and will add over US$500m to its PRICE TARGET | % TO PT INR3,500 (INR3,700) |

revenues. However, the acquired entities declining revenue profile and thin -15%

52W HIGH-LOW INR6,430.00 - INR3,909.05

margins will weigh on overall growth and ROCE post acquisition which in

FLOAT (%) | ADV MM (USD) 31.3% | 17.71

turn should drive derating. We cut target PE to 17x, lowering our PT to

MARKET CAP INR1.2T | $12.7B

Rs3,500. Reiterate UPF.

TICKER LTM IN

^Prior trading day's closing price unless otherwise

LTM's US$185m acquisition of... LTM plans to acquire Randstad's Tech services business in noted.

Europe (France, Germany, Belgium & Luxembourg) and Australia for US$185m. The deal value

implies EV/sales of 0.3x, which is low compared to the recent deals in the Indian IT space. The

deal is expected to close by 3QFY27. FY (Mar) CHANGE TO JEFe JEF vs CONS

2027 2028 2027 2028

...Randstad's IT/consulting practice in Europe/Australia... The acquired entities provide REV NA NA NA NA

IT Services in digital engineering, cybersecurity and IoT domains to clients in Aerospace EPS NA NA NA NA

& Defense, Automotive, Utilities verticals in Europe (78% of revenues) and BFS vertical in

Australia (22% of revenues). Over CY23-25, the acquired business's revenues have declined at 2027 (INR) Q1 Q2 Q3 Q4 FY

~12% CAGR to US$544m. Moreover, with the entire delivery being nearshore/onshore (2,900 EPS -- -- -- -- 200.70