Mindtree slips 3% after 26% drop in Q3 net profit

The company posted profits of Rs 140 cr on a revenue of Rs 1,209 cr in the Oct-Dec period last year

Shares of MindTree slipped nearly 3% in trade on Friday after the IT company reported 26% drop in its net profit at Rs 103 crore due to poor performance of its US and Europe subsidiaries.

Reacting to the earnings, the stock fell as much as 2.8% to Rs 471 on the BSE. 

The Bengaluru-based company posted profits of Rs 140 crore on a revenue of Rs 1,209 crore in the October to December period last year.

"The year-on-year decline in net profit can be contributed partly to currency fluctuations and partly to poor performance of our international business. The companies that we acquired — Magnet360 in the US and Bluefin in Europe — operated at a margin historically lower than MindTree's organic margin," said Rostow Ravanan, chief executive officer and managing director, MindTree.

Ravanan continued to be cautious in the macroeconomic environment at least for the next few quarters.

In dollar terms, the company reported 4.7 per cent year-on-year growth in revenue to $192.2 million. During the quarter, one of the company's clients doubled its billing, resulting in first client in the $100 million category. Overall, MindTree added $300 million worth contracts in the third quarter.