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Mastek eyes 4-fold growth, aims for $1-bn revenue by 2026

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Mastek eyes 4-fold growth, aims for $1-bn revenue by 2026

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The Mumbai-headquartered company, which had cash of over Rs 750 crore as of March 31, will be looking for organic growth and scouting for acquisition targets in the US.

Mastek eyes 4-fold growth, aims for $1-bn revenue by 2026

Mid-tier IT company Mastek is aiming for a nearly four-fold growth in its top line to a yearly rate of $1 billion by 2026 or early 2027 through a mix of both organic growth and acquisitions, a senior official said on April 20. The Mumbai-headquartered company, which had cash of over Rs 750 crore as of March 31, will be scouting for acquisition targets in the US in the pursuit of its aspiration, its Global Chief Financial Officer Arun Agarwal told PTI.

"Our aim is to have a yearly revenue rate of USD 1 billion by the early part of the second half of the current decade. It can be either in 2026 or early 2027. We will achieve that both organically and through inorganic means," he said.

The listed company closed FY22 with revenues of Rs 2,183 crore or $293 million, which were over 26 percent higher than the year-ago period. For the March quarter, its revenues grew 20.3 percent to Rs 581.5 crore or over $75 million, while the net profit came at Rs 88.2 crore.

Agarwal said the company gets over two-thirds of its revenues from the UK market, where it has a special focus on serving the IT needs of the state-run entities, while the US contributes only 18 percent. The share of the US will go up to 30 percent of the revenue as the growth outpaces the overall company's rise, and the UK's share will come down to 50 percent of the pie when it achieves the $1-billion revenues, he said.

The growth in US revenues will have to be achieved through acquisitions, and the company will be scouting for assets there, he said, adding that the acquisition can be executed either through internal accruals or debt or going in for new capital infusion as well. Agarwal said the operating profit margin declined by 0.20 percent from a sequential perspective to 20.8 percent, but added that it is one of the best-in-the-universe of mid-tier IT players.

The company had nearly 5,000 employees at the end of FY22, which included 3,682 working offshore in India and the rest at onsite locations. Agarwal said it will continue to hire both from campuses for freshers and laterally as the requirement comes up. The Mastek scrip closed 0.82 percent down at Rs 2,802.55 apiece on the BSE on April 20.

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