MUMBAI: The country’s fifth biggest IT services firm Tech Mahindra on Friday reported a 93 per cent jump in December quarter net profit at Rs 983 crore, helped by a low-base in the year-ago period. The Mahindra group company’s performance was impacted in the year-ago period, and it had reported a net profit (after minority interest) of Rs 510 crore in the year-ago period, while the same stood at Rs 1,250 crore in the quarter-ago period.
For the reporting quarter, its revenue from operations increased by 1.4 per cent to Rs 13,286 crore, while the cost of services were down by 5.1 per cent at Rs 9,456 crore, but was down 0.2 per cent when compared with the quarter ago’s Rs 13,313 crore.
TechM’s senior executives attributed the sequential dip in revenues to the impact of the cross-currency headwinds.
The company’s chief executive and managing director Mohit Joshi, who took over the helm a year ago, said he is enthused by the progress made by the company so far and made it clear that the effort is to show sustainable growth in the business and not to chase “low quality” deals to show strong numbers in a particular quarter.
The operating profit margin, which had dipped to a low of 5.4 per cent last year leading to the major hit on profits has climbed to 10.2 per cent in the December quarter, and Joshi said that it will continue climbing up to 15 per cent by FY27.
Joshi said efficient delivery of services, right pricing and cost optimization helped the company deliver wider margins, while chief financial officer Rohit Anand said sufficient levers to expand the number exist with it.
The company was able to book new deals of $745 million across the telecom and manufacturing sectors during the reporting quarter.
From a revenue perspective, the banking, financial services and insurance vertical led the growth followed by the communication business, while the challenges faced by the auto sector led to some difficulties on the manufacturing front.
The company had over 1.50 lakh employees as of December 31, 2024 and Anand said the company is on track to add the 6,000 freshers and over 4,700 have been inducted already in the first nine months of the fiscal year.
The company scrip closed 1.81 per cent down at 1,658.85 a piece on the BSE on Friday, as against a 0.55 per cent correction on the benchmark sensitive index Sensex.
