Shares of Happiest Minds Technologies Ltd. extended their rally to a third session on Wednesday after the company revised its growth estimates higher for the next financial year. The stock popped nearly 14% early in the session, after closing 17.6% higher on Tuesday.
The company revised its fiscal 2027 growth forecast to 12.5% from the earlier 10%, "reflecting the company's confidence that its AI-First strategy and broader portfolio of strategic initiatives are generating measurable traction ahead of prior expectations", according to a statement. The following year, it has set a target of 15% growth.
"We are witnessing all-round growth led by rapid acceleration in financial services, healthcare, hi-tech, and manufacturing by robust adoption of AI," said Co-Chairman and CEO Joseph Anantharaju. "The enhanced pipeline and strong business momentum we are experiencing validates our AI First strategy and reinforces our confidence in delivering superior outcomes for clients and stakeholders. Our solid FY27 forecast is a clear reflection of this trajectory."
Happiest Minds was early in carving out the generative AI business unit and has been proactive in selling GenAI services, according to a recent Kotak Institutional Equities report on IT Services. The company could charge premium billing rates for personnel providing AI services.
"A lot of companies are moving away from larger vendors to get better attention from mid-tier vendors. Happiest Minds will be a beneficiary of the trend. At the same time, it is not a boutique vendor that can get consolidated in vendor consolidation initiatives," the note said.
Share Price Movement
Happiest Minds share price gained as much as 13.5% to Rs 454 on the NSE, compared to a 0.3% decline in the benchmark Nifty 50. The relative strength index was over 70, indicating the stock is overbought. In the previous session, the stock hit a 52-week high of Rs 708, after a surge of nearly 20%.
The stock is down 36% on a 12-month basis.
All eight analysts tracking Happiest Minds have a 'buy' rating on the stock, according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 38%.
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