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Tech Mahindra Q3 EBITDA seen up 27% at Rs 259 cr
Software services provider Tech Mahindra is expected to report a profit after tax of Rs 281.45 crore in the October-December quarter of FY12, a mild growth of 1.8% as compared to Rs 276.5 crore in the previous quarter.
Software services provider Tech Mahindra is expected to report a profit after tax of Rs 281.45 crore in the October-December quarter of FY12, a mild growth of 1.8% as compared to Rs 276.5 crore in the previous quarter.
Company's pre-exceptional profit after tax (i.e. Satyam) is likely to go up by 8% to Rs 150 crore from Rs 138.8 crore quarter-on-quarter.
Revenues are seen going up by 12.8% to Rs 1,501 crore from Rs 1,333.3 crore during the same period.
EBITDA is expected to go up 26.8% to Rs 259 crore from Rs 204.2 crore quarter-on-quarter.
EBITDA is seen improving at 17.25% in the third quarter of FY12 as against 15.3% in the previous quarter.
Expectations
- Company to continue to show tepid growth
- Dollar revenues flat due to expected cross-currency headwinds of around 200 basis points and pressure on revenues from BT * BT growth (37% to revenue) to decline sequentially * Non BT to continue with strong growth (last quarter up 6.9%)
- Margins to improve sequentially due to Indian rupee depreciation and also Q2 had a wage hike. Offset due to weakness in BT margins
Management commentary on margins post Q2 was
- BT margins are likely to face headwinds in the near-term. However, management expects to offset these in the medium to longer term.
- In the non-BT business, management does not expect any decline in pricing, margins going forward.
Management comments relating to growth visibility in BT and the merger of Tech Mahindra & Satyam would be the key factors to look for.
