Quess Corp a good long term bet as acquisitions start to contribute to bottomline, impact of pandemic to be transient

Covid Pandemic impact on SIS has been limited. Long growth drivers intact
July 30, 2020
Nestle a steady performer but very high valuations do not justify fresh investment
July 30, 2020

Quess Corp is India’s largest staffing company with presence a few international locations. Post its listing in 2016 the company has been pursuing inorganic growth options which has boosted topline but profits net of funding costs are just about beginning to grow. The major risk factor is its acquisition strategy and removal of 80JJA tax benefit which would increase the tax rate significantly. We have an over weight rating as assimilation of acquisitions is largely over and these are now contributing well. Long term prospects are good given rise in start-ups and MNCs expanding their operations in India. Operations are presently impacted by Covid-19 pandemic. Exposure to deeply impacted sectors is limited and hence recovery should be speedy once normalcy returns – 30-07-2020 Price: 347.95 Rating: Over Weight Recommendation: Buy

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