Hexaware Technologies Ltd. saw its shares climb by nearly 8% on the BSE, reaching a high of Rs 574.20, following the company's recent AI Day event. During the event, the IT firm detailed its strategic vision for leveraging artificial intelligence to cultivate new revenue streams and enhance overall profitability.
Hexaware's AI Strategy Unveiled
At the core of Hexaware's forward-looking approach is its “Zero Friction, Infinite Momentum” strategy. This comprehensive framework addresses six critical and interconnected areas: vulnerabilities, technical debt, project backlogs, software defects, support tickets, and licensing costs. The company emphasized its significant progress in AI adoption, reporting over 900 AI agents in production and more than 70% of its delivery processes being AI-assisted. Furthermore, over 46% of its client base is actively leveraging AI solutions, with more than 50% of current engagements incorporating AI or AI-infused technologies.
Hexaware is also aggressively pursuing larger deals, targeting a 30% win-ratio for contracts exceeding $100 million. The company anticipates the emergence of new revenue pools across specialized areas such as AI-for-AI solutions, healthcare, market data analytics, and professional services. Productivity gains driven by AI are expected to come from increased volumes, expanded project scopes, new revenue streams, and fixed total-cost or gain-share pricing models. While this strategy broadens Hexaware’s addressable market, analysts note that converting these opportunities into substantial revenue and bookings remains a key metric to monitor.
Brokerage Reactions and Price Targets
Following the AI Day, several leading brokerages have updated their ratings and price targets for Hexaware shares. CLSA set a 'Buy' rating with a target price of Rs 730, one of the highest projections. Kotak Institutional Equities also recommended a 'Buy', targeting Rs 660. Other optimistic outlooks include IIFL at Rs 620 and Axis Capital at Rs 610. MOFSL suggested a 'Buy' rating with a target of Rs 720, implying a significant potential upside.
Conversely, Jefferies maintained an 'Underperform' rating, setting the lowest target price among recent calls at Rs 500. ICICI Securities issued a 'Hold' rating with a target price of Rs 580. JM Financial, which holds an 'ADD' rating with a target of Rs 605, highlighted that Hexaware is currently trading at 20 times its consensus earnings per share for calendar year 2027.
Navigating Growth and Client Consolidation
Despite lowering its 2026 revenue guidance, Hexaware's management expressed confidence that this represents a deferral of growth rather than a loss. Factors expected to support a stronger performance towards the end of 2026 and provide a solid foundation for 2027 include delayed deal ramp-ups, sustained momentum in modernization programs, and healthy growth across its banking, healthcare, and manufacturing verticals. Nuvama, another brokerage that attended the AI Day, noted that business in 2026 has been impacted by consolidation among 13 of Hexaware's top clients. However, the IT firm remains confident in achieving the necessary quarterly growth rate to reach its 6-7% constant currency year-over-year top-line growth target for 2026.