Tech Mahindra Q3 profit likely to grow 13% at Rs 201 cr

Reported profit after tax (post Satyam, wherein Tech Mahindra holds 42.7 percent stake) is likely to fall by 20.6 percent QoQ to Rs 235 crore in the third quarter.

Mahindra Satyam 's (erstwhile Satyam Computer Services) third quarter consolidated net profit slumped 74 percent year-on-year (71 percent quarter-on-quarter) to Rs 80 crore, due to a one-time claim settlement (costs Rs 294 crore exception loss) reached with Aberdeen UK.

Revenues in dollar terms are seen going up by 0.8 percent QoQ to USD 323 million while revenues in rupee terms are expected to jump 7.3 percent QoQ to Rs 1,750 crore in December quarter.

Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to be flat at Rs 337 crore as against Rs 338 crore QoQ.

Meanwhile, EBITDA margin is seen declining at 19.25 percent in the third quarter as against 20.72 percent in second quarter of financial year 2012-13 due to appreciation of the rupee against the USD, consolidation of acquisitions and furloughs.

Q3 highlights

According to analysts, Tech Mahindra is likely to report an organic dollar revenue decline of around 2-2.5 percent due to revenue degrowth from BT.

Consolidation of Hutchison and Comviva acquisition will add to the revenues and result in tepid dollar revenues growth. Analysts say Hutchison Global Services acquisition will add an incremental USD 27 million and Comviva USD 3.5 million to revenues.

Margin headwinds from appreciation of the rupee against the USD, consolidation of acquisitions and furloughs

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