Mastek tumbles 15% on muted numbers for the December quarter

Despite a 25% correction from its 52-week high level, Mastek has outperformed the market in the past one year by surging 147 per cent, as against a 20 per cent rise in the Sensex.

Shares of Mastek tumbled 15 per cent to Rs 2,750 on the BSE in Thursday’s intra-day trade after the IT company reported muted earnings for the October-December quarter. Mastek's Q3 revenue grew 3.7 per cent in constant currency (CC) sequentially. In rupee terms, revenue was up 3.4 per cent at Rs 551.90 crore, while dollar revenue grew by 2.2 per cent to $73.6 million over September 2021 quarter (Q2).

At 11:18 am; Mastek traded 12 per cent lower at Rs 2,844.95, as compared to 0.33 per cent decline in the S&P BSE Sensex. With today’s fall, the stock has declined 25 per cent from its 52-week high of Rs 3,666 hit on October 19, 2021. Despite the significant correction, Mastek has outperformed the market in the past one year by surging 147 per cent, as against a 20 per cent rise on the BSE benchmark index.

The company's consolidated net profit was up 2.4 per cent at Rs 83.5 crore in Q3, as against Rs 83.5 crore in Q2. Earnings before interest, taxes, depreciation, and amortization (ebitda) margin contracted by 7 bps quarter-on-quarter (QoQ) at 21.1 per cent during the quarter.

The management said despite industry wide challenges driven by high attrition, investment in talent retention and lateral hires, we have been able to maintain healthy operating EBITDA margin at 21.1 per cent.

The company added 25 new clients in Q3FY22. Total active clients during Q3FY22 was 421 as compared to 447 in Q2FY22. 12 months order backlog was at Rs 1,271 crore ($171.0 mn) as on Q3FY22 as compared to Rs 1,154 crore ($155.5 mn) in Q2FY22, reflecting a growth of 10.1 per cent in rupee terms and 9.9 per cent in CC terms on QoQ.