Zensar Technologies: Broker Targets Up to ₹650 in 2026

What changed after Zensar’s Q4FY26 print

Zensar Technologies is back in focus after a mixed Q4FY26, with brokerages updating their views on growth and valuations. Choice Broking reiterated its ‘BUY’ call and said the stock could see a 23% upside over the next one year. It set a target price of ₹650 per share following the results. The brokerage said it is moderating near-term expectations even as its longer-term view remains intact.

Axis Direct took a more cautious stance. It maintained a ‘HOLD’ rating with a target price of ₹580 per share, implying an 8% upside from the then prevailing market price (CMP) referenced in its note. Together, the two calls highlight the gap between near-term demand concerns and longer-term execution expectations.

Choice Broking’s target: ₹650 and a ‘BUY’ call

Choice Broking said it revised its target price to ₹650, which it linked to an implied P/E multiple of 15x. The brokerage described the quarter as “mixed” and pointed to weakening underlying demand. It also said near-term headwinds are likely to persist.

Key issues flagged by Choice included continued softness in the TMT and HLS verticals, client exits due to consolidation, and margin pressure from upfront investments and transition costs. Despite these constraints, Choice highlighted a strong large-deal indicator as a positive signal for the pipeline. Based on its estimates, the brokerage expects revenue, EBIT and PAT CAGR of 8.7%, 11.8% and 11.4% respectively over FY26 to FY29E.

Mega deal win stands out amid demand softness

Choice Broking called out a “mega deal win” of $101.8 million, up 123% quarter-on-quarter. It said the deal momentum signals pipeline traction and improving client confidence. The contrast between big-ticket wins and a softer demand environment is central to the current debate around Zensar.

For investors, the key question is how quickly such deal wins translate into billed revenue and whether transition costs and early investments fade quickly enough to protect margins. Choice’s note indicates that, in its view, the pipeline is improving, but the near-term operating environment remains challenging.

Axis Direct stays on ‘HOLD’ with ₹580 target

Axis Direct maintained a ‘HOLD’ rating with a target of ₹580 per share. It said the company’s focus over the years has been on reskilling and upskilling in next-generation technology, which has supported healthy utilisation. Axis also said management is working to reduce exposure to the TMT vertical.

According to Axis, the strategy involves shifting focus to high-growth verticals and integrating AI, which it believes can eventually support healthier growth. The note frames the current phase as a transition, where portfolio mix and execution matter as much as near-term demand.

Stock moves: price, market cap, and recent returns

In the session cited, Zensar Technologies slipped 3.66% to ₹528.35 compared with the previous close of ₹548.45. The company’s market capitalisation was stated at ₹12,019 crore. The stock’s recent trend has been weak, with the report noting a 23% fall over three months and a 34% decline over six months.

Over longer windows, the same dataset cited that the stock has lost 15% over two years and 27% over one year. The broader takeaway is that the stock has seen sustained pressure even before the latest set of estimates, which raises the bar for execution and guidance delivery.

Technical indicators in focus: RSI, beta, moving averages

On the technical front, the relative strength index (RSI) was reported at 44.9, indicating the stock was neither overbought nor oversold at the time. The one-year beta was reported at 0.94, suggesting average volatility relative to the market.

The report also noted that Zensar shares were trading below the 5-day, 10-day, 20-day, 50-day, 100-day and 200-day moving averages. Taken together, these indicators point to a weak price structure even as brokerages debate valuation comfort and earnings visibility.

Financial snapshot: FY23 operating trend

Reported financials in the provided data show that Zensar’s revenue from operations for FY23 was ₹4,848.2 crore, up 14.2% from ₹4,243.8 crore in FY22. Profitability, however, weakened on a year-on-year basis. Net profit after tax in FY23 was ₹327.6 crore compared with ₹421.7 crore in the previous year.

EBITDA in FY23 was ₹552.2 crore versus ₹656.5 crore in the prior year, and EPS was ₹14.47 compared with ₹18.43. This mix of revenue growth and softer profitability is relevant because the latest brokerage commentary also flags margin pressure from investments and transitions.

Key data table: targets and market indicators

Market impact: what the brokerage split signals

The difference between a ₹650 target (Choice) and a ₹580 target (Axis) reflects differing comfort levels on near-term growth and margin visibility. Choice’s optimism appears anchored in deal momentum and medium-term CAGR expectations, while acknowledging near-term headwinds in specific verticals and cost pressures. Axis, meanwhile, emphasises long-term capability building through reskilling and AI integration, but keeps its recommendation at ‘HOLD’.

For the market, this split matters because Zensar is coming off a period of weak returns and is also trading below key moving averages. That combination typically keeps sentiment fragile, making quarterly execution, client retention, and the pace of revenue conversion from deal wins critical.

Analysis: what to watch next

Two operational levers stand out in the provided commentary. First is vertical mix, particularly management’s stated effort to reduce exposure to the TMT vertical and shift towards higher-growth segments. Second is margins, where brokerages have explicitly pointed to investment and transition costs as near-term drags.

Investors will likely track whether large deal wins are sustained and whether they lead to steadier growth without further client exits due to consolidation. The brokerage notes also suggest that near-term expectations are being tempered even by bullish houses, which implies that guidance, utilisation, and margin commentary will remain key drivers.

Conclusion

Zensar Technologies is facing a tough near-term backdrop, but brokerages are split on the extent of upside, with Choice Broking targeting ₹650 on a ‘BUY’ call and Axis Direct maintaining a ‘HOLD’ with ₹580. The next set of updates on demand conditions in key verticals, deal conversion, and margin trajectory should shape whether sentiment improves meaningfully.