As of June 18, 2025, Genpact Ltd's estimated intrinsic value ranges from $43.91 to $78.30 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $78.30 | +81.3% |
| Discounted Cash Flow (5Y) | $62.65 | +45.1% |
| Dividend Discount Model (Multi-Stage) | $52.57 | +21.7% |
| Dividend Discount Model (Stable) | $54.37 | +25.9% |
| Earnings Power Value | $43.91 | +1.7% |
Is Genpact Ltd (G) undervalued or overvalued?
With the current market price at $43.18, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Genpact Ltd's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.53 | 0.72 |
| Cost of equity | 6.3% | 8.9% |
| Cost of debt | 4.0% | 4.6% |
| Tax rate | 23.3% | 23.7% |
| Debt/Equity ratio | 0.17 | 0.17 |
| After-tax WACC | 5.9% | 8.1% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $63 | $11,632M | 79.6% |
| 10-Year Growth | $78 | $14,368M | 65.7% |
| 5-Year EBITDA | $42 | $7,977M | 70.2% |
| 10-Year EBITDA | $56 | $10,481M | 52.9% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $568M |
| Discount Rate (WACC) | 8.1% - 5.9% |
| Enterprise Value | $6,995M - $9,711M |
| Net Debt | $675M |
| Equity Value | $6,320M - $9,035M |
| Outstanding Shares | 175M |
| Fair Value | $36 - $52 |
| Selected Fair Value | $43.91 |
| Metric | Value |
|---|---|
| Market Capitalization | $7551M |
| Enterprise Value | $8226M |
| Trailing P/E | 14.31 |
| Forward P/E | 13.79 |
| Trailing EV/EBITDA | 7.30 |
| Current Dividend Yield | 147.57% |
| Dividend Growth Rate (5Y) | 9.96% |
| Debt-to-Equity Ratio | 0.17 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $23.49 |
| Discounted Cash Flow (5Y) | 25% | $15.66 |
| Dividend Discount Model (Multi-Stage) | 20% | $10.51 |
| Dividend Discount Model (Stable) | 15% | $8.16 |
| Earnings Power Value | 10% | $4.39 |
| Weighted Average | 100% | $62.21 |
Based on our comprehensive valuation analysis, Genpact Ltd's weighted average intrinsic value is $62.21, which is approximately 44.1% above the current market price of $43.18.
Key investment considerations:
Given these factors, we believe Genpact Ltd is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.