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Mphasis shares have five triggers for 30% upside, Morgan Stanley highlightsBrokerage firm Morgan Stanley said Mphasis is "positioning for a breakout." Micro factors appear to be aligning for the company, and any macro support from interest rate cuts could provide additional tailwinds to growth.By Meghna Sen    | Nimesh Shah   September 1, 2025, 9:25:41 AM IST (Updated)2 Min ReadShares of technology solutions provider Mphasis Ltd. gained as much as 2% on Monday, September 1, after global brokerage firm Morgan Stanley raised its price target on the stock, citing improving fundamentals.

Morgan Stanley hiked the target price for Mphasis to ₹3,625 from ₹3,500 earlier. The new target implies a potential upside of nearly 30% from Friday's closing levels.

The brokerage said Mphasis is "positioning for a breakout." Micro factors appear to be aligning for the company, and any macro support from interest rate cuts could provide additional tailwinds to growth.

It added that "chasing growth within FCF margin guardrails creates re-rating potential," while naming Mphasis as its preferred mid-cap play.

Morgan Stanley highlighted five catalysts for a potential re-rating:

- Consistent pipeline growth.

- Larger quarterly deal wins, rising from the current run-rate of $300-400 million, particularly outside the BFSI vertical, and better conversion of deal wins into revenue.

- Greater revenue diversification beyond the top 10 clients and BFSI, with opportunities in healthcare.

- Potential rate cuts, which could lift digital risk (DR) revenue.

- A possible exit by the majority stakeholder over the next 2–3 years.

The brokerage also raised its revenue growth estimates for Mphasis, by 50 basis points for FY27 and 100 basis points for FY28.

Morgan Stanley believes improving growth trends create re-rating potential and expects the stock to narrow its valuation gap with mid-cap peers as the revenue growth gap reduces.

It further said investors should "double down on the potential promoter stake sale rather than wait for it as an entry point."

Shares of Mphasis are trading 1.96% higher on Monday at ₹2,842.70. The stock has gained 3% in the last one month and is flat on a year-to-date basis.Continue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.First Published: Sept 1, 2025 9:25 AM ISTCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsMphasisshare market today