Mphasis Q2 net profit up 37% at Rs 2.7 bn on good show in key verticals

Mid-tier IT services company Mphasis on Friday posted a 37 per cent rise in its net profit at Rs 2.7 billion in the September 2018 quarter, backed by strong growth in key verticals such as emerging industries and insurance. Net profit rose 4.9 per cent in on as sequential basis. 

In the quarter ended September 30, 2018, gross revenue of the Blackstone-owned company grew 24.5 per cent to Rs 19.48 billion on a year-on-year (YoY) basis, while on a sequential basis it increased 6.9 per cent. In constant currency terms, growth in revenue was 14.8 per cent YoY and 3 per cent sequentially.

The company said its new deal wins in the quarter stood at $210 million, which came from direct international business. Of these, 77 per cent were in areas of new generation digital services.

“We are pleased with the health of our pipeline and continued strong execution across multiple vectors, especially in new gen services,” said Nitin Rakesh, CEO and Executive Director at Mphasis.

Among key verticals, its banking and capital market vertical, which contributed 46 per cent to the gross revenue, registered a growth of 4.6 per cent sequentially. 

While the IT firm’s emerging industries vertical grew 12.1 per cent on a sequential basis, the growth rate for information technology, communication, and entertainment was at 5.6 per cent during this period. 

In the July-September period, the Americas accounted for 80 per cent of its revenue, while EMEA (Europe, Middle East and Africa) contributed 11 per cent to the total revenue pie.

Mphasis also witnessed a 200 basis points improvement in its operating margin to 16.4 per cent YoY, though it contracted 20 bps on a sequential basis. The company had cash reserve of Rs 25.18 billion at the end of the September quarter.