Motilal Oswal has upgraded Hexaware Technologies to a buy rating with a significantly higher target price of ₹660 in its research report dated July 30, 2026. The brokerage's target price is based on valuing the company at 23x CY27E EPS, implying approximately 15% upside from current levels. This represents a notable upgrade from previous recommendations, with the revised target substantially higher than ICICI Securities' ₹580 target price.
Hexaware reported revenue of USD 405 million in Q2CY26, representing a 4.4% QoQ growth in constant currency terms, slightly below the brokerage's estimate of 4.8% QoQ CC growth. According to Motilal Oswal's analysis, the company's Adjusted EBIT margin stood at 13.6%, broadly in line with the estimate of 13.5%. However, Adjusted PAT declined 6.1% QoQ and 13% YoY to ₹3.3 billion, falling short of the brokerage's estimate of ₹3.8 billion.
The company demonstrated mixed performance across its verticals during Q2CY26. Professional Services/Healthcare and Insurance segments grew 13.3%/6.8% QoQ, showing strong momentum in these key areas. Conversely, Technology and Travel segments declined 3.1%/1% QoQ, indicating some challenges in these verticals. As reported by Motilal Oswal, this broad-based performance across the diversified portfolio continues to support the company's growth trajectory.
According to management data cited in the report, 13 of the top-20 clients have consolidated vendors in the last five quarters, representing 4-5x the normal run-rate. This significant consolidation trend indicates a structural shift in the IT services market, with clients increasingly opting for fewer, larger service providers. The company is also seeing healthy traction in USD 10mn+ legacy modernisation deals and AI-led deals including zero licensing and strategic AI partnerships for clients in the range of USD 100K to 1-2mn.
