Shares of Sagility India Ltd. have surged over 60% from their IPO price of ₹30, yet they still hold significant growth potential, according to global brokerage firm Jefferies, which initiated coverage on the stock on Friday, December 20.

The foreign brokerage now has a ‘Buy’ recommendation on Sagility India, with a price target of ₹52 per share. Jefferies’ price target implies a potential upside of 18% from Thursday’s closing levels.

Jefferies wrote in its note that Sagility India is a leading US-healthcare-focused BPM firm, with extensive domain expertise.

The brokerage expects the company to deliver a compound annual growth rate (CAGR) of 12% in revenue and 40% in profit over FY25-27, supporting a favorable earnings growth outlook and sustaining current price-to-earnings (PE) multiples.

Jefferies also highlighted a few key factors driving Sagility’s growth. The company is well-positioned to sustain double-digit revenue growth, while the normalisation of depreciation and amortization (D&A) costs, along with efforts to reduce debt, are expected to boost earnings per share (EPS), the brokerage wrote in its note.

With its sharp focus on the US healthcare BPM market and a clear strategy for growth, Sagility stands out as an attractive investment opportunity, Jefferies said.

The brokerage believes the company’s strong performance and financial improvements could help it maintain its valuation and appeal to investors over the next few years.

Shares of Sagility India Ltd. are trading 4.99% higher on Friday at ₹46.09. The stock has risen 54% from its IPO price of ₹30 per share.