Zensar Tech disappoints
Zensar Technologies posted a disappointing set of earnings for Q2FY21. The stock price is reacting accordingly, down among the top three losers on the BSE. It opened 4% lower at Rs.280 and from there recuperated a bit but remains in the red. Its 20% LC for the day is at Rs.149.60.
The company posted a 1% (QoQ) decline in operating revenue at Rs.979 crore. A 9% drop in cost of revenue helped boost the profit. EBITDA came in at Rs.184 crore, up 29% and margins improved from 14.4% to 18.8% (QoQ).
During the quarter, the company incurred an exceptional item of loss amounting to Rs.89 crore – this was on account of adjustment in respect of excess of carrying amount including goodwill over recoverable amount on classification as “Held for Sale”. This dented the net profit significantly.
Net profit came in at a mere Rs.2 crore v/s Rs.75 crore (QoQ). Profit before tax and this exceptional loss was up 23% at Rs.124 crore.
The digital segment accounted for 61% of the overall revenues in the second quarter of FY21. The financial services business has grown, with insurance and banking segment growing at 5% and 11.5% QoQ respectively. Consumer Services has shown recovery in Q2FY21 with 13% QoQ increase.