JPMorgan has initiated coverage on Sagility with an ‘Overweight’ rating and a target price of ₹54, citing secular tailwinds from increasing outsourcing in the US healthcare sector. Sagility’s deep domain expertise and strong client relationships position the company to benefit from stable growth, particularly as it is tied to non-discretionary spending in healthcare.
The brokerage forecasts an 18% adjusted earnings CAGR over FY24-27E, with reported earnings expected to grow at 50% due to moderating deferred costs and amortization expenses. However, JPMorgan highlights risks such as high client concentration, potential in-sourcing by top clients, regulatory changes in US healthcare, and competitive pressures from Generative AI adoption. Despite these risks, the firm believes Sagility is well-placed to capitalize on its market position
