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Tech Mahindra shrugs off weak Q1 results

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Capital Market
Last Updated : Aug 02 2016 | 12:28 PM IST

Tech Mahindra rose 3.34% to Rs 506 at 9:53 IST on BSE after consolidated net profit fell 12.58% to Rs 750.10 crore on 0.54% increase in revenue to Rs 6920.90 crore in Q1 June 2016 over Q4 March 2016.

The result was announced after market hours yesterday, 1 August 2016.

Meanwhile, the S&P BSE Sensex was up 101.06 points, or 0.36%, to 28,104.18.

On BSE, so far 2.29 lakh shares were traded in the counter, compared with an average daily volume of 1.45 lakh shares in the past one quarter. The stock hit a high of Rs 509.85 and a low of Rs 485.25 so far during the day. The stock hit a 52-week high of Rs 581.95 on 28 September 2015. The stock hit a 52-week low of Rs 407.50 on 29 February 2016. The stock had underperformed the market over the past one month till 1 August 2016, falling 4.29% compared with 3.16% rise in the Sensex. The scrip had also underperformed the market in past one quarter, rising 0.51% as against Sensex's 9.36% rise.

The large-cap company has an equity capital of Rs 485.77 crore. Face value per share is Rs 5.

Earnings before interest, taxes, depreciation and amortization (EBITDA) fell 10.59% to Rs 1029.10 crore in Q1 June 2016 over Q4 March 2016. The EBIDTA margin fell sharply to 14.9% in Q1 June 2016 from 16.7% in Q4 March 2016.

Commenting on the first quarter results, Vineet Nayyar, Vice Chairman, Tech Mahindra, said that the company had a steady quarter inspite of the seasonal weakness in the mobility business. The management expects improvement of the company's profitability going ahead, Nayyar said.

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Commenting on the first quarter results, C P Gurnani, Managing Director & CEO, Tech Mahindra said that the business has done well on several parameters like large client growth, digital wins and strong cash flows. Automation and delivery excellence are two key focus areas for the year going forward, he added.

Tech Mahindra is a specialist in digital transformation, consulting and business re-engineering solutions.

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First Published: Aug 02 2016 | 9:49 AM IST

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