Tech Mahindra posts 49% growth in net

Share of profits from associate firm Mahindra Satyam and forex gain helped Tech Mahindra register 48.7 per cent growth in net profit at Rs 257 crore for the third quarter ended December 31 from Rs 172.8 crore in the corresponding quarter last year.

Share of profits from Mahindra Satyam over the last two quarters was Rs 51.5 crore. Tech Mahindra holds 43 per cent stake in Mahindra Satyam. The company also registered $8 million (Rs 36 crore) forex gain for the quarter. Revenue for the quarter at Rs 1,211 crore was up 2 per cent from Rs 1,187.3 crore.

Slow growth in the telecom sector impact the quarter revenues. Sequentially, the firms net profit was up 70.6 per cent from Rs 150.7 crore, but revenue were down 21 per cent.

“British Telecommunications (BT) contributed $74 million for the quarter. But the systems integration business continues to be lumpy. The business declined by 9 per cent sequentially. The discretionary spend is still slow and large deals are taking time to kick-in,” said Sonjoy Anand, Chief Financial Officer.

“We have turned in a satisfactory performance in a period of low discretionary spend by our customers. We have remained steadfast in our pursuit of our goals, of investing in capabilities to enable customer delight, while maintaining focus on operating and financial metrics,” said Vineet Nayyar, Vice-Chairman, MD and CEO. Attrition at 30 per cent continues to be high.

“We will hire 4,000 freshers. The rest will be done laterally,” said Sujit Baksi, President, Corporate Affairs & BPO.