Tech Mahindra Q2 net profit rises 26% to Rs 1,339 cr

IT firm Tech Mahindra on Monday said its consolidated net profit has increased by 25.7 per cent to Rs 1,338.7 crore for the quarter ended September 30, 2021.

This is against a net profit of Rs 1,064.6 crore in the July-September 2020 quarter, Tech Mahindra said in a statement.

Its revenue from operations was up by 16.1 per cent to Rs 10,881.3 crore during the said quarter as compared to Rs 9,371.8 crore in the year-ago period. The company also declared special dividend of Rs 15 per equity share of Rs 5 face value.

On sequential basis, the net profit was down about 1 per cent (from Rs 1,353.2 crore in June 2021 quarter) while revenue grew 6.7 per cent (from Rs 10,197.6 crore in Q1 FY22).

The board has proposed a special dividend of Rs 15 per share.

In dollar terms, the net profit was up nearly 26 per cent to USD 181 million, while revenue rose by 16.4 per cent to the USD 1.47 billion in the second quarter.

“As we record our highest sequential growth in a decade, we remain committed to deliver long-term sustainable and profitable growth for the company. We have witnessed strong traction across all key markets as we invest in our digital capabilities through strategic partnerships," Tech Mahindra Managing Director and CEO CP Gurnani said.

He added that the company continues to accelerate its clients' digital journey "by creating Human Centric Experiences, helping them gear up for tomorrow, today".

Cash and cash equivalent stood at $1,626 million as of September 30, 2021.

Tech Mahindra's total headcount stood at 141,193, higher by 14,930 people from the preceding quarter.

Tech Mahindra Chief Financial Officer Milind Kulkarni said the company's strong execution has ensured that it maintains its profitability margins while accelerating growth momentum.

"We remain committed on the operational excellence journey we have boarded, and continue to create value to shareholders through efficient capital return,” he added.

Tech Mahindra has also announced the acquisition of Lodestone, a digital engineering quality assurance provider for new age digital companies.

A separate filing by Tech Mahindra showed that it will pay total consideration of up to $105 million including earnouts.

The acquisition will bolster Tech Mahindra's digital engineering capabilities to effectively utilize data strategy and address machine learning challenges, the statement said.

The transaction will further enhance Tech Mahindra's capability to provide end-to-end product quality assurance across hardware, software, and data layers to strengthen the company's positioning as a leading digital transformation enabler in the engineering space, it added.