Mindtree Q2 profit falls 34.6% to Rs 135 crore on the back of weak rupee

Net profit stood at $19.2 million, a 43.5 per cent sequential growth.

IT firm Mindtree on Wednesday posted its Q2 FY20 earnings, in line with Street expectations, with 3.2 per cent sequential growth and 11 per cent y-o-y growth in constant currency terms, at $271 million. Net profit stood at $19.2 million, a 43.5 per cent sequential growth.

In rupees terms, the profits were down 34.6 per cent y-o-y at Rs 135 crore. “Foreign exchange, increase in remuneration year on year have affected our net profit. It will improve in the forthcoming quarters,” said Debashis Chatterjee, CEO of Mindtree. The company reported an operating margin of 13 per cent for the quarter ended September 30, a 300 bps growth from the 10.3 per cent in the previous quarter. Without mentioning an exact range, the CFO of Mindtree, Pradip Menon, said that the Q3 operating margin will be better than in Q2, and continue with a sequential growth in Q4.

Growth in digital remained flat at 38 per cent from the previous quarter, while the infrastructure management and tech support business division grew to 24.6 per cent from 23.8 per cent sequentially. However, digital has grown 18 per cent y-o-y.

Hi-tech and media continue to be the highest growth drivers for Mindtree with 39.8 per cent revenue share, followed by retail-CPG-manufacturing and BFSI at 21.7 per cent and 21.6 per cent , respectively. —FE