Tax refund helps Tech Mahindra post 67% rise in net
October, 22nd 2008
Indias sixth-largest software exporter Tech Mahindra posted a 66.7% growth in net profit at Rs 302.1 crore for the second quarter ended September 2008 against Rs 181.1 crore in the corresponding period of the previous year.
The company posted a revenue growth of 29.8% at Rs 1,164.1 crore for the second quarter against Rs 897.1 crore in corresponding quarter of the previous year.
The jump in profit was partly aided by a tax refund of Rs 60 crore from the UK government. On a sequential basis, rupee revenues were up 4%, but dollar revenues were down marginally because of the appreciation of the dollar against the pound, the currency in which the company earns most of its revenues.
The telecom sector is insulating us from the seismic effects in the economy, said CP Gurnani, president, international operations, Tech Mahindra. The company caters mainly to three sets of clientele in the telecom space telecom service providers, telecom equipment manufacturer and independent software vendors.
The companys employee strength crossed 25,000 in the September 2008 quarter. While revenues from BT have shown flat growth, non-BT revenues grew 11% sequentially, while business from the Middle East, Africa, India and other regions outside US and Europe, showed a 42% growth.
The Tech Mahindra scrip closed 11.5% up at Rs 413.10 on Tuesday. The company announced a dividend of Rs 4 per share. Commenting on the results, Romal Shetty, executive director-telecom, KPMG, told ET, The results are not surprising. Companies, which provide services in the telecom space, have not been affected by the recession yet.
However, in the coming months, if the current financial crisis continues, big telcos might defer their expansion plans, he added.