Tech Mahindra Q2 Results: A Mixed Bag
Tech Mahindra, one of India’s leading IT companies, has announced its Q2 results, which show a 5% increase in profit but miss estimates. The company’s revenue has also seen a modest increase, but the attrition rate remains a concern. In this article, we will delve into the details of the results and analyze their impact on the Indian stock market.
Q2 Results Highlights
The company’s Q2 results show a revenue of Rs 13,994.90 crore, which is a 4.8% increase from the previous quarter. The net profit has also seen a 5% increase to Rs 1,194.50 crore. However, the results have missed estimates, with the revenue and net profit falling short of expectations.
The company’s Ebit has seen a 15% increase to Rs 1,699.30 crore, and the margin has improved to 12.1% from 11.1% in the previous quarter. The company has also announced a dividend of Rs 15 per share.
Attrition Rate Remains a Concern
The company’s attrition rate remains a concern, with the IT services last 12-month attrition rate standing at 12.8%. The total headcount has also decreased by 1,559 year-over-year to 152,714. The company will need to focus on reducing the attrition rate and increasing the headcount to drive growth.
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Deal Wins and Revenue Growth
The company has seen broad-based deal wins, with the new deal wins TCV standing at $816 million. The revenue in USD has seen a 1.4% increase to $1,586 million, which is a positive sign for the company.
The company’s CC growth has marked the strongest growth over the last 10 quarters, and the communications segment has seen a downtick. The company has also been recognized as a key player in the government’s AI mission, which is a positive development.
Impact on the Indian Stock Market
The Q2 results of Tech Mahindra will have an impact on the Indian stock market, particularly on the IT sector. The results have missed estimates, which may lead to a negative reaction from the market. However, the company’s revenue growth and improving margin may help to mitigate the negative impact.
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Conclusion
In conclusion, Tech Mahindra’s Q2 results have been a mixed bag, with the company’s profit increasing but missing estimates. The attrition rate remains a concern, and the company will need to focus on reducing it to drive growth. The deal wins and revenue growth are positive signs, and the company’s recognition as a key player in the government’s AI mission is a positive development.
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