Mindtree

By Research Desk
about 12 years ago
Mindtree

The market was extremely disappointed with the Q2FY13 numbers of Mindtree. The company posted a 19% (QoQ) decline in net profit at Rs.72 crore on a 6% rise in net revenue at Rs.596 crore. The decline in bottomline was mainly on account of the forex loss of Rs.41.50 crore. What really spooked the market was the fact that, like Infosys, it too lowered its guidance. It now expects a 11% revenue growth for FY13 compared to the earlier estimate of 11.14%. This is the second time that the company has lowered its guidance. The company has stated that uncertainty in the global economic environment is posing short-term challenges, delaying customer decisions.

During the quarter, the company has recorded additional tax credit of Rs. 9.7 crore relating to FY11 and FY12 and thus provision for current quarter is lower by Rs.9.7 crore. That also helped shore the bottomline which otherwise could have dipped further. In terms of geographical distribution, major contributor remains USA at 58.1%, same as Q1Fy13. Europe has gone up marginally from 28.8% to 29.3%. India contribution has decreased from 6.4% to 6%. In terms of revenue by business, IT Services remains the bread winner, contributing 68.5% (69% QoQ) and project engineering services is at 31.5% (31%). It added 454 people during the quarter, taking the total headcount to 10,883 people. It added 11 new clients during the quarter. Despite the lowering of guidance, many brokerage houses have maintained a ‘buy’ on the stock as they expect the company to do well, operationally and could report better numbers if the rupee remains stable at current levels.

3433.35 (+3.15)

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