- 1Q22 revenue was in line, at 22% our FY22e forecasts. PATMI underperformed, at 17% of our FY22e forecasts due to higher employee benefits expense and tax rate.
- Total revenue grew 27% YoY, above expected growth of 25%, driven by 25%/60% YoY increases in Omnichannel CX and Sales & Digital Marketing services. TDCX added 10 new clients for the quarter.
- FY22e revenue guidance was reduced by 5%, to S$650mn-675mn, on weaker macroeconomic outlook across all services and verticals.
- We reduce our FY22e revenue by 5% to S$665mn on slower growth, and cut PATMI by 33% to S$88mn on higher-than-expected equity share payment that led to higher Employee Benefits Expense. We maintain a BUY recommendation with a lowered DCF target price of US$15.76 (previous US$22.00), with a WACC of 9.7%, and a terminal growth rate of 3.0%.