Mahindra & Mahindra’s information technology arm, Tech Mahindra, on Thursday posted a rise of 57.6% in its net profit during the July-September quarter on the back of growth across geographies and verticals. The firm’s net profit stood at R718 crore during the quarter under review, against R456 crore in the same period last year.
Net revenue during the period stood at Rs 4,771.5 crore against Rs 3,523.7 crore in the same quarter last year.
“The issue pertaining to fiscal crisis in the US is over which is a relief. Europe has started looking better and the greenshoots are apparent,” Tech Mahindra vice-chairman Vineet Nayyar said.
“More importantly, Europe is constantly re-evaluating their economy and hence selecting cost-efficient IT solutions which is a positive for the Indian IT industry,” he added.
During the quarter ended September, business from Europe has grown 6.8% and the US and rest of the world has grown 1.5%. “Today, we are in a better shape in terms of deal pipeline,” Tech Mahindra managing director and chief executive CP Gurnani said. “Asian and African markets are looking good and the pricing is steady,” he added.
Tech Mahindra’s retail, logistics and travel vertical witnessed a growth of over 7%, banking, financial services and insurance vertical has grown by 5.5%, media and entertainment by 3.8%, telecom by 2.7% and manufacturing by 1.1%.
In US dollar terms, Tech Mahindra has posted a sequential fall of 6% in its net profit due to currency headwinds. The firm posted a net profit of $114 million, against $121 million in the previous quarter. The firm’s net revenues for the quarter stood at $758 million, against $724 million in the previous quarter.
Tech Mahindra has hedged $900 million at the rate of R59 per US dollar and £245 million at the rate of R92.4 per pound. The company has witnessed a forex loss of $4 million during the quarter, against a gain of $23 million in the previous quarter.
Tech Mahindra added 2,172 employees during the quarter and has a total of 85,234 employees as on September 30. The company has a utilisation rate at 75% and will be issuing a wage hike of less than 2%.