- Firstsource Solutions (FSL) shares corrected by 49.70% and hit a nine-month low.
- The share price of the company has been declining for three weeks, especially after it lowered its FY22 revenue growth guidance.
- Its major revenue comes from the UK and the US. Analysts have given their views about the share.
Shares of Firstsource Solutions (FSL) are under continued pressure as they have hit a nine-month low of ₹122.15 apiece. Its 52-week low is at ₹95.70, whereas its 52-week high is at ₹242.85. The stock has corrected 49.70% from its 52-week high level that it attained on July 19, 2021.
Firstsource Solutions Limited provides bespoke services and solutions in the Business Process Management industry, across banking, financial services, communications, media, healthcare, technology and more. It is a leading player and serves more than a hundred clients globally. It generates 70% of its revenues from the US, 29% from the UK and the rest from other countries.
The share price of the company has been declining for three weeks, especially after it lowered its FY22 revenue growth guidance. It has revised downward revenue growth guidance of FY 22 to 14-14.5%. In Q3FY22, it reported a 4.9% YoY growth in its revenue in CC terms, which is the lowest in the past six years. It indicated that the UK business was impacted for the fourth quarter due to employee absence due to covid infections. It expects to recover in the March quarter.
Analysts at Emkay Global Services in a result update said that lower-than-anticipated volumes in the collection business amid record-low delinquency rates, sharper than anticipated decline in the mortgage business due to aggressive tapering by the Fed and an uptick in interest rates, and the softness in the UK due to a surge in covid cases impacted the company’s Q3 revenue, on February 16th 2022.
On 21st February 2022, Sumeet Bagadia, Executive Director at Choice Broking had given a sell call on First Source solutions, with a target of ₹122- ₹120, and he asked investors to maintain a stop loss at ₹131. (Target Achived)
As per a research report dated 7th February 2022, analysts at ICICI Direct recommended a hold rating on the company’s shares with a target price of ₹162, which is 16 times its P/E on FY24E.
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