IT player Tech Mahindra is expected to report subdued December quarter earnings on January 29.
Along with the numbers, the management's commentary on deal wins and outlook on communications and enterprise segments will be closely watched.
As per the estimates of brokerage firm Elara Capital, the company may report a 1.4 percent year-on-year (YoY) decline in December quarter revenue.
"Revenue growth would be equally led by enterprise and communications vertical. Recovery in the communications business would be led by BPO services. Tenzing acquisition could add marginally to overall revenue," Elara said.
It expects Tech Mahindra's CC revenue to increase by 1.4 percent. Margins are expected to be stable led by cost optimisation initiatives, Elara said as it sees Tech Mahindra's Q3 profit rising 6.9 QoQ but falling 0.6 percent YoY.
Brokerage firm Nirmal Bang expects the company's margins to improve further in Q3FY21 as the salary hike is expected only in Q4FY21 for junior employees.
Nirmal Bang said the trajectory of improvement in margins in the portfolio companies is a key monitorable. Receivables situation and commentary on 5G will also be areas of focus for investors.
The brokerage expects a 1.2 percent YoY fall in revenue, while PAT may rise 12.4 percent YoY.
Kotak Institutional Equities expects a modest growth of 2 percent in CC revenue on a sequential basis, split equally between telecom and enterprise segments.
It expects EBIT margin of 14.5 percent, a QoQ increase of 30 bps and a YoY increase of 226 bps. Strong YoY growth in EBIT of 17.5 percent will not translate into net profit due to lower forex gains and higher tax rates, it said.
The estimates of Kotak show a 0.8 percent YoY decline in net sales and a 2.1 percent YoY decline in Tech Mahindra's reported PAT for the December quarter.
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