Tech Mahindra Q2: Analysts expect profit at Rs 272.7 cr

Tech Mahindra's profit after tax (including Satyam wherein company holds 42.7% stake) is expected to go down to Rs 272.7 crore in the quarter ended September 2012 from Rs 338 crore in the previous quarter. Even its profit after tax (excluding Satyam) is likely to fall by 18 percent to Rs 154 crore from Rs 188 crore during the same period.

Dollar revenues are seen going up by 5 percent QoQ to USD 295.5 million and rupee revenues are expected to go up by 4.7 percent QoQ to Rs 1,616 crore in the second quarter of FY13. Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to decline to Rs 315 crore in the three months period ended September 2012 from Rs 330 crore in the June quarter. EBITDA margin is seen declining 190 basis points QoQ to 19.5 percent during the same quarter. Analysts feel the wage hike will impact margins. Investors should watch out for ramp ups in two deals and outlook on BT & growth in non-BT. Tech Mahindra made two acquisitions recently, both in the telecom space. The company acquired Hutchison Global Services in September for USD 87.1 million in an all cash deal with contracted revenue of USD 845 million over 5 years. According to analysts, the acquisition will add around USD 11 million to revenues. It also acquired 51 percent stake on a fully diluted basis in Comviva Technologies for Rs 260 crore.
 
The stock rallied 66 percent in 2012 - in tandem with Satyam. The outperformance was on the back of consistent strong performance of Satyam, which beat expectations.