Analysis Report: Mindtree Ltd. (BUY; Estimated Price: Rs.723.67)

About the Company

Mindtree Limited is mid-cap international Information Technology consulting and Implementation Company that delivers business solutions through global software development. The Company was incorporated in August 1999 by 10 professionals with an initial funding of USD 9.1mn

Trend of Repo-rate and Inflation

Repo-Rate:

• ‘Repo Rate’ is the rate at which RBI (Reserve Bank of India) lends money to commercial banks. RBI is the Central Bank of India.

• Repo Rate = Repurchase Agreement

Decline of IT Stocks after Brexit

What is Brexit?

It is a word that has turned out to be utilized as a shorthand method for saying the UK leaving the EU - combining the words Britain and exit to get Brexit.

Demonetization Explained

Demonetization means removing the status of certain existing units of currency or the currency as a whole as legal tender of the economy. It is done by stopping the production of prescribed currency and its circulation in the market. Legal tender is a mode of payment recognized by the law in a country to be valid for meeting financial obligation.

Lowering of INR against Dollar

How exchange rates are determined?

Market forces, like demand and supply fluctuates the exchange rates within the economy. In case of US Dollar to INR, if demand of US dollar increases against INR then rate of USD against INR will also increase but there are many factors which affect market condition or market forces.

Volatile Market

When market becomes volatile investor tries to withdraw their funds from the market till the market become stable and when US investors start withdrawing their funds then the demand of dollar suddenly increases which leads to the appreciation of USD.