Private equity major Blackstone has reduced its stake in Mphasis by 8 per cent.
Marble II Pte Ltd, a unit owned by PE firm Blackstone, bought these shares in a bulk deal, at ₹960 a share. However, the private equity major clarified that it is committed to remain a long-term majority shareholder in Mphasis and does not intend to sell any additional stake in the company. Aberdeen, T Rowe Price and Oppenheimer bought the stake.
By selling 8 per cent, Blackstone has more than doubled its profits. In April 2016, Blackstone had bought HP’s 60.5 per cent stake in Mphasis at ₹430 a share. Now, it sold 15.6 million shares at ₹960 a share. On news of Blackstone reducing its stake by 8 per cent, Mphasis’ shares fell 3 per cent in early market trade. Later, it closed at ₹985, marginally up compared to the previous day’s close.
These developments come in the backdrop of a strong close to fiscal 2018. The company posted a 10 per cent revenue growth (in dollar terms), led by sharp growth momentum in its HP channel business. However, BFSI, a core vertical for the mid-cap IT company, which accounts for 59 per cent of total revenues, posted a moderate performance. According to Madhu Babu, Research Analyst — Institutional Equities, Prabhudas Lilladher, led by a strong exit revenue growth, US dollar revenue growth has been increased to 14.9 per cent versus 13.3 per cent as estimated earlier.
BFSI’s dollar revenues grew by 8 per cent year-on-year in FY18, while the insurance vertical revenues declined y-o-y in FY18. Revenues from DXC/HP business grew 20.6 per cent in constant currency terms, and 16.8 per cent on reported currency basis.
Also, for the fiscal 2018, Mphasis had $551 million worth of total contract value (TCV) in direct international business, of which, 83 per cent came in its new generation services business.