Expect margins to improve going further: NIIT Tech

Though margins saw a dip in the first quarter due to an increase in wages, expect margins to improve as the volumes increase over the following quarters, says Arvind Thakur, CEO, NIIT Technologies.

Speaking to CNBC-TV18, Arvind Thakur adds that the company’s performance for FY14 will be in line with Nasscom’s guidance. Below is the edited transcript of the interview on CNBC-TV18 Q: Growth in the first quarter was tepid at about 0.9 percent. Will performance in FY14 be lower than Nasscom’s guidance?
A: Our Q1 performance is normally limited as the effect of the completion of significant government business in the Q4 of the previous year boosts revenues sequentially over the subsequent quarters. So, we do expect our business to perform inline with the Nasscom estimates. Q: What about margins, going forward?
A: The increase in wages implemented in Q1 has been the prime cause for reduced margins. However, as the volume of business improves over the subsequent quarters, margins will improve as well.