Mindtree hits a new low

Mindtree has been down on a low for some time now. Today too, it hit a new 52-week low at Rs.507 and it remains deep in the red, figuring amongst the top three losers on the BSE.

As such the company has posted a very disappointing Q1FY17 and ever since then, it has been hitting new lows. The new worry now is that it announced a not-so-good Q2 performance, The company stated that its margins will be lower than expected, with revenue and EBITDA margins expected to fall, lower than Q1.

The company has also warned that its Bluefin business is expected to show a loss at EBIT levels. It has also categorically stated that the savings from the various initiatives will not be enough to offset the topline slowdown. Thus overall H1FY17 will be much lower YoY.

The midcap IT company had posted a sharp 7% (QoQ) drop in net profit at Rs.123 crore and growth is revenue was flat at Rs.1328 crore v/s Rs.1320 crore in Q4. Dollar terms, revenue was up 2% at $199 million but net profit fell 6% at $ 18.5 million. Disappointing was the 12% drop in operating profit at Rs.195 crore and its margins fell 200 bps to 14.7%.