Tech Mahindra, the country’s fifth largest IT firm, has posted a 57.6 per cent rise in consolidated net profit thanks to all-round growth across its operating geographies and services.
The Mahindra group company reported a net profit of Rs 718.4 crore in the second quarter as against Rs 455.8 crore in the same quarter a year ago.
During the second quarter, its revenues rose 35.4 per cent to Rs 4,771.5 crore (Rs 3,523.7 crore).
“Europe has started looking up and the greenshoots are apparent. On account of the economic crisis, there is a conscious move to rejig the economies by identifying and deploying cheaper and more cost-effective solutions. This makes India’s IT industry more relevant in the continent,” Tech Mahindra’s Vice-Chairman Vineet Nayyar said on the sidelines of a press conference today.
On a quarter-on-quarter basis, the company’s Europe business grew by 6.8 per cent while revenues from the US rose by 1.5 per cent. Among verticals, financial services, telecom and manufacturing grew by 5.5 per cent, 2.7 per cent and 1.1 per cent, respectively, said C.P. Gurnanai, Chief Executive Officer.
Adds Nayyar: “We are cautiously optimistic of the future. Macro-economic indicators have improved in the US. There is far greater acceptability in Europe now than it was before. Pessimism that came in the last two years has lifted.”
Wage hike next quarter
The company will dish out wage hikes in the next quarter. “If we are not able to successfully deploy levers such as utilisation, the wage hikes may have a two per cent impact on operating margins,” said Milind Kulkarni, Chief Financial Officer.
He added that the fluctuating rupee caused the company to report a forex loss of around $4 million
The Tech Mahindra scrip was up by 0.46 per cent to close at Rs 1,580.2 on the Bombay Stock Exchange today.
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