TechMahindra Q2 Net rises marginally to Rs 720 cr

Notwithstanding a healthy rise in revenue, Tech Mahindra today reported a marginal growth in September quarter net profit at Rs 719.7 crore as forex losses impacted the bottom line.
The Mahindra Group company had reported a net post-tax profit of Rs 718.4 crore in the year ago period.
Chief Financial Officer Milind Kulkarni said there was an amortisation gain in the year-ago quarter through a large deal signed in FY 2008 that used to result in a gain of USD 9 million till last year, which is over now, impacting the bottom line growth.
Also, there was a Rs 45.8 crore loss on the forex side, he said, adding that with high volatility in the rupee, the company changed its hedging strategy recently under which it reduced its duration of the protection to two years from the earlier five years.

The revenue rose 15 percent to Rs 5,488 crore over the same period last fiscal while on a sequential basis it rose 7.2 per cent. The profit was up 14.1 per cent on a sequential basis.
Its pre-tax margins also improved to 19.9 per cent during the quarter as against the preceding June quarter's 18.1 per cent.

Executive Vice Chairman Vineet Nayyar said the company believes in long-term contracts and the movement of the performance may vary according to the time period.
He said early on, the company is in the investment phase which impacts the margins but once the work is on stream, the returns are higher.

During the reporting quarter, it experienced an increase in attrition at 18 per cent against 16 per cent in the quarter ago period.
It added three large clients during the quarter, while the total number of client additions stood at 17, taking the total number of active clients to 649.