Tech Mahindra's net Q3 profit up by 14.3% to Rs 1309.8 crore

IT services firm Tech Mahindra on Friday reported a 14.3 per cent rise in its consolidated net profit at Rs 1,309.8 crore for the December 2020 quarter.

The Mumbai-based firm had registered a net profit (attributable to owners of the company) at Rs 1,145.9 crore in the year-ago period, Tech Mahindra said in a statement.

However, its revenue from operations was almost flat at Rs 9,647.1 crore in the quarter under review from Rs 9,654.6 crore in the year-ago period, it added.

Sequentially, Tech Mahindra's net profit was up 23 per cent (from Rs 1,064.6 crore), while revenue was higher by 2.9 per cent (from Rs 9,371.8 crore in September 2020 quarter).

Earnings per share (EPS) was at Rs 14.9.

In dollar terms, the net profit was up 23.7 per cent sequentially to $177.7 million, while revenue grew 3.4 per cent to $1,308.7 million in the said quarter.

"The technology modernisation cycle continues to gather pace and our positioning of creating Experiences through Nxt. Now has seen us gain significant traction in the market place. We believe that the Future is Now and we are continuously innovating to address this shift in spending," Tech Mahindra Managing Director and Chief Executive Officer CP Gurnani said.

Manoj Bhat, Chief Financial Officer at Tech Mahindra, said the company's focus on operational excellence has again yielded results as it structurally changed its delivery model.

"We are seeing consistent improvement in our operating metrics and we are confident of continuing on this transformation journey in the coming quarters," he said.

The company's total headcount was at 1,21,901 people, a reduction of 2,357 people from the September 2020 quarter.

The Board of Directors of the company, subject to requisite consents and approvals from jurisdictional NCLTs, approved the Scheme of Merger by Absorption of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce - two wholly owned subsidiaries - with the company and their respective shareholders, the statement said.

The transaction will lead to consolidation of entities and greater efficiency in the overall combined business, including economies of scale, efficiency of operations, operational rationalisation, reduction in overheads including administrative, managerial and other expenditure, it added.