Tech Mahindra hits 52-week high on better than expected Q1 earnings

Q1 operating profit rose 37% to Rs 330 crore, while margins expanded by 300 basis points at 21.4% on y-o-y basis.

Tech Mahindra is trading higher by 3% at Rs 783 after reporting a better-than-expected 22% year-on-year (yoy) jump in consolidated net profit at Rs 339 crore for the first quarter ended June 2012, on back of strong performance in the Mahindra Satyam unit and currency boost. Revenues grew 19% at Rs 1,543 crore on y-o-y basis.

The company’s earnings before interest, tax, depreciation and amortization (Ebitda or operating profit) rose 37% to Rs 330 crore, while margins expanded by 300 basis points at 21.4% on y-o-y basis.

“We are focused on margin improvement. Due to the global ecosystem, customers are scrutinising all aspects of expenditure, including IT spending, and are looking to minimise financial commitments,” said Vineet Nayyar, Vice-Chairman, Managing Director and CEO, Tech Mahindra.

The stock opened at Rs 768 and hit a 52-week high of Rs 794 on the BSE. A combined around 51,000 shares changing hands on the counter in opening trades on both the exchanges.