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Decision cycles taking longer in new projects: MindTree
MindTree CEO and Managing Director Krishnakumar Natarajan said the margin expansion of up to 450 bps was 'satisfying' as the quarter is considered seasonally weak.
MindTree reported revenue of Rs 519.70 crore for the third quarter ended December 31, 2011, an increase of 35% over the previous year. The company made a net profit of Rs.60.60 crore, 99% higher than the same period in the previous year.
Addressing the media post result announcement, MindTree CEO and Managing Director Krishnakumar Natarajan said the margin expansion of up to 450 bps was "satisfying" as the quarter is considered seasonally weak. "About 90% of clients indicating stable budgets."
The growth in revenue from product engineering services, which accounts for about one-third of the company's overall earnings, was relatively sluggish, increasing by 10.7% during the period. "I think product engineering will grow in Q4 versus 5% de-growth in Q3," Natarajan told reporters.
He attributed the better performance on the margin front to the weakening of the rupee during the quarter. Natarajan said the global environment continues to be challenging for the outsourcing business. "The decision cycles are taking longer in new projects," he adds.
Revenue from IT services, which amounted to Rs 346.60 crore, grew 52% over the previous year. Revenues in dollar terms grew 21.6% on an annualised basis, reaching USD 103 million during the quarter.
