MphasiS will take a good beating down on the HP front: Avinash Gorakshekar
"I think 70% of the revenue still comes from HP and to a certain extent that was supposed to be the key kind of variable for Mphasis for the incremental growth ahead. "
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| Updated: Avinash Gorakshekar, VP Research, Edelweiss Financial Advisors in an interview with ET Now talks about MphasiS.
Is there a complete direct correlation that clients would derive or investors will drive in Mphasis, HP missing the forecast, guiding to lower revenues for the next year and that having direct bearing on Mphasis?
Yes, exactly I think 70% of the revenue still comes from HP and to a certain extent that was supposed to be the key kind of variable for Mphasis for the incremental growth ahead.
People already slightly sceptical on the margins because whatever business came from HP was obviously at a predetermined kind of a discounted price, so to that extent it was a negative but now with HP itself cutting down their forecast obviously going forward for Mphasis would be difficult.
In terms of client concentration, a 70% is considered to be quite high and they will take some time before again look out for new clients and actually make the model more stable. So to that extent I think it is clearly correlated anything happens on the HP front would obviously mean that there is a big beating down for the Mphasis stock.
Is there a complete direct correlation that clients would derive or investors will drive in Mphasis, HP missing the forecast, guiding to lower revenues for the next year and that having direct bearing on Mphasis?
Yes, exactly I think 70% of the revenue still comes from HP and to a certain extent that was supposed to be the key kind of variable for Mphasis for the incremental growth ahead.
People already slightly sceptical on the margins because whatever business came from HP was obviously at a predetermined kind of a discounted price, so to that extent it was a negative but now with HP itself cutting down their forecast obviously going forward for Mphasis would be difficult.
In terms of client concentration, a 70% is considered to be quite high and they will take some time before again look out for new clients and actually make the model more stable. So to that extent I think it is clearly correlated anything happens on the HP front would obviously mean that there is a big beating down for the Mphasis stock.
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