Mphasis (MPHL IN): First Take: Revenues beat, margins miss; FY27 rev guide revised upwards

Mphasis 2QFY27 print beat on revenues, while margins missed. Revenues grew 3.3% CC QQ that was largely in line with JPMe, but ahead of consensus by 160bps. New deal TCV was healthy at $466mn (up 1% QQ), with 5 large deals (above $20mn) closed in 2Q. AI led deal wins were at 66% (up from 63% in 1Q). Ebit margins remained flat QQ at 14.8% but came in 40bps below consensus and JPMe. It delivered on its Q2 target of achieving the best sequential growth in cc terms in the last 3 years and expects momentum to continue in H2 on the back of a strong deal pipeline. It increased the FY27 revenue growth guide to low double digits (from high single digits to low double digits earlier) and maintained Ebit margin guide of 14.75-15.75%. The PAT and EPS beat was driven by higher-than-expected other income and a lower-than-expected tax rate. Maintain Overweight with a Jun-27 price target of Rs2,650 based on 18.5x P/E.