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Last Updated : Oct 21, 2016 11:51 AM IST | Source: CNBC-TV18

Mindtree Q2 profit seen down 7%, revenue may also decline

Mindtree is expected to disappoint street on Friday, especially after its profit warning announced in September. According to analysts polled by CNBC-TV18, profit is likely to fall 6.9 percent quarter-on-quarter to Rs 115 crore in Q2FY17.

 
 
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IT company Mindtree is expected to disappoint street on Friday, especially after its profit warning announced in September. According to analysts polled by CNBC-TV18, profit is likely to fall 6.9 percent quarter-on-quarter to Rs 115 crore in Q2FY17.


Revenue is seen falling 0.3 percent to Rs 1,324 crore and dollar revenue may decline to USD 198 million from USD 199 million sequential basis.


Operating profit is expected to slip 4.66 percent to Rs 186 crore and margin may shrink 65 basis points to 14.05 percent compared with preceding period.

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After a strong performance in FY14-16, the company has been going through a period of uncertainty. It was considered as one of the better midcap IT stock but the second profit warning in 6 months hurt its credibility.
 
On September 2, Mindtree said it expected Q2FY17 revenue to be lower than the previous quarter due to cross-currency movements, project cancellations and slower ramp-ups in a few large clients across different verticals and continued weakness in its UK-based subsidiary Bluefin.


It said margin was also going to be lower than planned with a decline in EBITDA margins in Q2FY17 compared to Q1FY17 and Bluefin business was expected to report an EBITDA loss for the quarter.


Key things to watch out for:
-Outlook for 2HFY17 as it had indicated growth revival
-Outlook on margins, which have come off significantly in recent quarters
-Senior management exits, its impact on business in the near term, if any, and replacements of Radha and Veeraraghavan



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First Published on Oct 21, 2016 08:51 am
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