Ambit starts India's eClerx Services with 'sell' citing execution risks

eClerx Services

Today 05:05

** Ambit starts India's eClerx Services ECLE.NS with "sell" and a PT of 1,635 rupees
** Brokerage says stock's valuation overlooks slowing growth and execution risks
** Ambit expects USD revenue growth to slow to 12% CAGR in FY26-29 from 17% in FY21-26 as banking and financial services' growth moderates, deal momentum stagnates and client concentration remains high
** Brokerage flags GenAI-related risks that could impact verticals contributing 42% of co's revenue
** ECLE trading ~1% lower at 1,914.70 rupees
** Ambit forecasts a 330-bps decline in EBITDA margin over FY26-29 due to a shift toward near-shore delivery, higher sales investments and a richer employee mix
** Avg rating of 11 analysts on stock at "hold"; median PT is 1,980 rupees - LSEG-compiled data
** YTD, stock down 18.5%



($1 = 94.7900 Indian rupees)

 (Reporting by Kashish Tandon in Bengaluru)
 ((Kashish.tandon@thomsonreuters.com))