Long term Investment options - Hinduja Global Solutions Ltd - Leading with resilience.

Recommendation of companies for long term investment in share market - Hinduja Global Solutions Ltd - Today's share price of  Hinduja Global Solutions Ltd is Rs. 1296.

Then in undivided India, Parmanand Deepchand Hinduja, a self-made young entrepreneur from the legendary village of Shikarpur, established the foundation for the Hinduja Group. Under the direction of Chairman Srichand Hinduja and the capable assistance of his brothers Gopichand, Prakash, and Ashok Hinduja, the Hinduja Group went on to strengthen its businesses through diversifications in the fields of automotive, information technology, media, entertainment & communications, infrastructure projects, development, oil & specialty chemicals, power, real estate, and healthcare, spanning continents. The group has offices in numerous important cities throughout the world, including India, and employs around 200,000 people. The Hindujas, who are ardent supporters of traditional family values, have always worked to incorporate the family notion into their commercial endeavors.

The company provides a range of Business Process Management (BPM) services to clients in the healthcare, digital, and customer experience (CX) sectors (customer experience). The organization currently has 56 delivery facilities spread throughout 7 countries. The USA, Canada, Jamaica, UK, Europe, India, UAE, and the Philippines are the nations. As of FY21, there are 40,000 people employed by the company. India employs over 46% of all workers, followed by the Philippines (24%), the United States (8%), Jamaica (8%), Canada (7%) and the United Kingdom (6%).

The revenue break up of Hinduja Global Solutions is given below.

Healthcare, Pharma & Health Insurance	56 %
Telecom & Technology	14 %
Products, Services & Retail	10 %
Banking, Financial Services & Insurance	8 %
Media	2 %
Chemicals & biotech	2 %
Others	8 %

When the first wave of the pandemic reached the globe, the company vigorously defended the effects of COVID by implementing its Work@Home solution. The promoter company and several sister/group companies have received loans from the corporation totaling 360 crores as of FY21. These loans offer better yields than FDs and are repayable on call. The sale of the company's healthcare division to Barings Private Equity Asia for an enterprise value of 8,900 crores INR was approved by the board in August 2021. The consent of the company's shareholders as well as other regulatory approvals are required for the planned deal. The company provides a dividend yield of 9.64%. The ROCE and ROE values of Hinduja Global Solutions Ltd are 110% and 125%, which indicates that by effectively using its debts, the company will be able to lower its cost of capital. The company's market capitalization is Rs. 5917 crores.The intrinsic value of shares of HGS Ltd is Rs. 17,376 and the stock is currently trading at a price of Rs.1296.

Pros

• The company's debt has been reduced, and it is practically debt-free.

• The stock's price is 0.76 times its book value.

• Over the past five years, the company has produced solid profit growth of 103% CAGR.

• The company has consistently paid out a solid 20.2% dividend. 

Cons

• Over the last five years, the company has generated a dismal revenue increase of -2.54%.

Financials

Total revenue from operations as of March 2021 was Rs. 558,891.83, 11.5 percent higher than Rs. 498,650.37 in the previous fiscal year.The company attained a profit after tax of Rs. 33,605.13, which is 63 per cent higher than the previous year. The total borrowings of the company for the financial year 2021 are reduced by 36 per cent. 60% of the total revenue of the company comes from long-tenured clients. In August 2022, the company declared an interim dividend of 50% of its face value. The company gave bonus shares in a ratio of 1:1 to its investors on February 2022.

What's recently happening in HGS Ltd?

The HGS board had approved the purchase of Nxtdigital's media and digital division in February 2022. Nxtdigital said in a separate filing to the stock market that 99.99% of its non-promoter shareholders had voted in favor of the company's plan of arrangement with Hinduja Global Solutions.

Hinduja Global Solutions is recommended for a long term investment in stock market considering the strong fundamentals of the company. The stock price is expected to attain a level of 3900 by 2027 by experts.

Read my previous blog : Term insurance - The most important part of your financial planning.

Related articles :3 companies that announced bonus issue of shares in November 2022

Read Fundamental Analysis Series :  Fundamental Analysis.

Read : Find your projects. 

References : Screener , Annual report of HGS Ltd Fin year 2021, Economic times, HGS official site.

 

If you are looking for a freelance writing job with a flexible schedule and a variety of orders to choose from, This is for you! Other than writing skills and strong desire to make money, all you need to begin working with an Internet connection and a PC / laptop.  Click the link here for registration. 

Has The Pandemic Affected Your Financial Situation? Not Enough Money To Pay Your Bills? Or Just Struggling Pay Check TO Pay Check? Here Is How You Can Fix It IMMEDIATELY!

Miracle Money Magnets

With Number 1 Best Selling Author Croix Sather