Mindtree Q4 net profit rises 49%, firm declares dividend of Rs 27/share

IT firm Mindtree on Monday reported 49% jump in net profit at Rs 473 crore for the quarter ending March 2022 as against Rs 317 crore in the year-ago period.

Revenue rose 37% to Rs 2,897 crore as compared to Rs 2,109 crore in Q4FY21.

“Our industry-leading growth through a year of rapid business and technology shifts demonstrates the relevance of our value proposition in reimagining businesses and driving digital transformation at scale,” said Debashis Chatterjee, Chief Executive Officer and Managing Director, Mindtree. “Our sequential revenue growth of 5.2% in constant currency made this our fifth consecutive quarter of 5%-plus growth in constant currency. Our full year revenue growth of 31.1% validates our strategy to capitalise on rising demand by diversifying our services portfolio, mining customers, and broadening industry partnerships. We are proud to have delivered EBITDA margin of 20.9% and PAT margin of 15.7%, our highest in a decade. 

"Our commitment to creating value for shareholders is reaffirmed by an EPS of Rs 100.2, our highest-ever adjusted for bonuses, and a full year dividend of Rs 37 per share, the highest in our history."

About the possibility of the company's merger with L&T Infotech, Chatterjee said it is a speculation during the company's earnings call.

Talking about the impact of the global geopolitical situation on business from Europe, Chatterjee said that the company doesn't see any significant softness in business from the region in near term, and it is also scaling up development centres located there.

North America accounted for 76.6% of Mindtree's revenue during the March 2022 quarter with growth of 28% year-on-year.

While only 7.1% of Mindtree revenue came from Europe, it was the highest growth region for the company with 69.2% year-on-year increase in business.

Attrition at the company during the reported quarter increased to 23.8%.

"Attrition continues to be an industry-wide issue. We expect the situation to gradually stabilise over next two quarters and eventually come down," Chatterjee said.

Communications, media and technology were the biggest revenue earners for the company with 45.8% share in the overall pie during the reported quarter.

"We are increasing investment in metaverse solutions and capabilities to extend our design thinking leadership into an integrated consulting-led metaverse offering," he added. 

The company's board recommended a final dividend of Rs 27 per equity share.

"The Board of Directors have recommended a final dividend of 270% (Rs 27 per equity share of par value Rs 10 each) for the financial year ended March 31, 2022 which is subject to the approval of shareholders at the Annual General Meeting," said Mindtree in a regulatory filing.

The company said its trailing 12 months attrition was 23.8% and it order book rose 17% in FY22 to $1.6 billion.

On Monday, the company's scrip on BSE closed 3.4% lower at Rs 3,956.

For the financial year 2021-22, consolidated net profit of Mindtree grew by 48.8% to Rs 1,652.9 crore from Rs 1,110.5 crore at the end of financial year 2020-21.

The consoldiated revenue of Mindtree rose to 10,525.3 crore at the end of 2021-22 from Rs 7,967.8 crore a year ago.