Mahindra Satyam Q2 net falls 21% to Rs 277 cr q-o-q

However, the consolidated revenue increased marginally by 3% to Rs 1,938 cr

Hyderabad-based consulting and IT services provider, Mahindra Satyam, reported a 16.8% increase in its net profit to Rs 278 crore for the second quarter ended September 2012, as compared to Rs 238 crore in the corresponding quarter a year ago, primarily on the back of operational efficiencies.  Net profit , however, plummeted 21.1% sequentially (Rs 352 crore in Q2 of FY13).

The company’s revenues stood at Rs 1,938 crore in the quarter under review, up 22.8%, as against Rs 1,578 crore during the same period last year.

“Our strengths in certain key verticals and competencies combined with increasing client confidence helped us deliver on both revenue growth and operating margins,” Vineet Nayyar, chairman of Mahindra Satyam, told mediapersons here on Tuesday.

Despite major issues around the Euro crisis and the decision-making cycles of customers getting longer, the company had reasons to be satisfied with this trajectory of growth, he added.

“Geography-wise, US continued to lead the pack with a growth of 4.4% Q-o-Q, and Europe with 4.2% and the rest of the world with 1%,” Nayyar said, adding that manufacturing and BFSI (banking, financial services and insurance) verticals primarily led the growth with 5.5%.

The company has added 6 new customers during the July-September quarter. Its total headcount stood at 36,787, a net addition of 791.  Cash and cash equivalents stood at Rs 3,062 crore as on September 2012.

“Our top 30 accounts continued to lead us in this growth. This clearly indicates the trust and faith that our customers reposed on us,” chief executive officer CP Gurnani said, adding that despite the wage hikes, the company had increased its EBITDA margins at 21.5%.

Board approves Rs 500-crore capex

Gurnani said that the company’s board had approved a total outlay of Rs 500 crore towards creating infrastructure at Nagpur, Bhubaneswar, Visakhapatnam, Chennai and Hyderabad.

“We should be spending around Rs 30 crore a month. The new facilities will create total seats of 3,500, and we will do it over a period of 18 months,” he said.