Mindtree is confident of continuing its growth momentum on the back of a strong order book. Even as the company is seeing caution in the market in specific sectors ahead of a seasonally weak quarter, it remains optimistic for the full fiscal year, Debashis Chatterjee, CEO and MD, told businessline.
The mid-tier IT services company reported a 27.5 percent y-o-y rise in net profit at ₹508.7 crore and a 31.5 per cent y-o-y increase in revenues at ₹3,400.4 crore on Thursday. Its first-half signings exceeded $1 billion with an order book of $518 million.
$1 b-plus order book
Chatterjee said, “Many of our clients are going through transformation growth, and we had a strong order book of transformation deals and confidence in H1. Our current order book is also fairly strong. For the first time in Mindtree’s history, we have a $1 billion-plus order book in the first half of the year itself. This gives us confidence to continue our growth momentum.”
However, amidst a probable slowdown in western economics, the company is seeing some caution being exercised by a few clients, especially in RCM and CMT, mostly in Europe. “Having said that, clients want to continue with some of the programmes that deliver immediate RoI and change programmess for maximising their revenue,” Chatterjee added.
5% revenue growth in 7 quarters
Mindtree has reported more than 5 per cent revenue growth in constant currency for seven consecutive quarters and anticipates for the rate to be sustainable at large. “Since Q3 is a seasonally-weak quarter, there will be some change. But we can absolutely go back to our growth path in Q4. We have the capabilities, machinery and pipeline to give us that confidence,” Chatterjee said.
On the integration process of Mindtree and L&T Infotech, the CEO said that regulatory approvals are almost at the fag end and they should be able to announce Day 1 — the day on which LTI Mindtree comes into existence — soon. “If everything goes as expected, the next quarter will be an LTI Mindtree quarter rather than a Mindtree quarter,” he said.
The company’s net employee addition has been sequentially low at 835, in contrast to 2384 additions last quarter. Chatterjee said, “We have consciously ensured that we also look at the talent-supply chain on the other side. Our employee addition is a culmination of the planning that we have done in terms of intake before we start operating as a single entity.”