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Mid-tier IT services company Mindtree has posted a 3.9 per cent year-on-year (YoY) increase in net profit to ₹206.2 crore for the March 2020 quarter on the back of record deal wins.
Revenues for the fourth quarter grew 11.5 per cent YoY to ₹2,050 crore. “Our relentless focus and client-first approach have resulted in robust Q4 performance on multiple dimensions – revenue growth of 1.9 per cent in constant currency, expansion of operating margin by 150 basis points and record deal wins of $393 million,” said MD and CEO Debashis Chatterjee.
In dollar terms, net profit was flat at $28.2 million while revenues grew 6.3 per cent to $278.4 million. “Our clients have been happy with the work-from-home transition as our productivity has been very good. We are better prepared than anyone else,” Chatterjee said.
He also said all campus hires will be honoured and, with regard to promotions and increments, a decision will be taken when the visibility into the future is better.
On Covid impact
Mindtree is also rationalising the sub-contracting pool for some time now as well as the long tail. “Looking ahead to fiscal 2021, we anticipate softness in demand due to the unprecedented Covid-19 pandemic. However, we’re well equipped to handle the global crisis based on the business continuity plan we have successfully implemented to ensure the health and safety of our employees while fully supporting our clients worldwide. We remain confident that we will continue to create value for our clients, drive profitable growth, develop future-ready talent and maximise shareholder value,” Chatterjee said. He also said that there are 764 bots employed with the company.
Emkay Global, in a note to investors, said while Mindtree’s overall operating performance was strong, growth continues to be fuelled by top client revenues in recent years, albeit growth elsewhere is weak. This dynamic is also evident in the vertical composition of revenues — wherein revenues have declined sequentially across all verticals barring hi-tech (+5.1 per cent QoQ).
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