Tech Mahindra Q1 profit rises 7% to Rs 959 crore, revenue up 4.6%

Tech Mahindra, the country's leading software services company, on Tuesday reported 6.8 per cent year-on-year (YoY) rise in consolidated net profit at Rs 959.30 crore for the first quarter ended June 30. The profit was down 15 per cent compared to Rs 1,132.50 crore in the March quarter.

"The Mahindra group company had posted consolidated net profit of Rs 897.90 crore in the same quarter last year," Tech Mahindra said in a filing to the Bombay Stock Exchange.

Consolidated revenue from operations increased by 4.6 per cent to Rs 8,653 crore in Q1FY20 as compared to Rs 8,276.30 crore in Q1FY19. However, Tech Mahindra's revenue was lower than Rs 8,892.30 crore in the March quarter.

During the quarter under review, EBITDA (Earnings before interest, tax, depreciation and amortisation) fell 3.2 per cent YoY to Rs 1,314 crore, while operating margins dropped 120 basis points (bps) to 15.2 per cent on yearly basis.

Basic earnings per share (EPS) stood at Rs 8.50 as against Rs 9.27 in the corresponding quarter of last fiscal.

In US dollar terms, consolidated profit climbed 5.2 per cent YoY to 138.7 million, while revenue rose 1.9 per cent YoY to 1,247.1 million.

Commenting on Q1 earnings, CP Gurnani, Managing Director & Chief Executive Officer, said, " We are very encouraged to see TCV deal wins worth close to half a billion USD across Enterprise and Communcations. We remain optimistic on the demand environment, evident from a very strong pipeline and deal coversions. Digital will continue to be a primary growth driver underscoring our collaborative approach through TechMNxt platform."

As of June 30, 2019, the company total headcount stood at 125,773, up 4,691 on the quarter-on-quarter basis.

The company, in a separate filing, said that its board has approved the proposal to acquire majority stake in Mad Power Media Solutions, LLC through its wholly owned subsidiary, Tech Mahindra (Americas), Inc.

Ahead of earnings announcement, shares of Tech Mahindra closed trade at Rs 640.30 apiece, down 0.93 per cent, on the Bombay Stock Exchange.

Edited by Chitranjan Kumar

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