Target: ₹2,650
CMP: ₹1,658.20
Established in 1970, MPS Ltd (MPSL) was a subsidiary of Macmillan (Holdings). During that time, the company served publishers by helping them publish books, journals, and research materials worldwide. This segment forms a major part of MPSL’s business to date.
Currently, the company operates across three segments, namely, content solutions, platform solutions and eLearning. Geographically, MPSL generates most of its business from North America and Europe. Going forward, the company aims to continue running the business on dual-growth engines of organic as well as inorganic growth and achieve the guided scale of ₹1,500 crore by FY28. In terms of funding, MPSL is well-equipped with strong cash generation, a debt-free status, and the ability to leverage its balance sheet if necessary.
We are confident that the combination of robust growth in the existing business and strategic inorganic expansions will lead to substantial value creation in the future. Furthermore, considering MPSL’s strong fundamentals and growth projections, the current valuation of the company does not appear excessively high.
Therefore, we initiate coverage of MPSL with a Buy rating and a target price of ₹2,650 (25x FY26E EPS), resulting in about 61 per cnet upside from current levels.