Majesco posts net loss of Rs 0.6 cr for Q2

Operating income was Rs 187 cr during quarter under review

Majesco, the de-merged insurance products and services business of Mastek, posted a loss of Rs 0.6 crore for Q2 FY16 as against Rs 1.5 crore net profit of Q1 FY16, on account of higher investments on product development, sales and marketing and research and development (R&D).

The operating income was Rs 187.4 crore during the quarter under review as compared to Rs 150.2 crore during the previous quarter reflecting an increase of 24.8% in rupee terms and a growth of 21.5% in constant currency terms.

Total income was Rs 188.8 crore during the quarter under review as compared to Rs 154.4 crore during the previous quarter, up 22.3 on Q-o-Q basis. Majesco had listed on the stock exchanges in August.

 

Farid Kazani, Managing Director, Majesco said that the results are a clear indication of the increase in spending on R&D , product development and sales and marketing.

"We needed to make the brand as a pure-play insurance company in the US. We were also able to add 3 new clients during Q2 FY16 with an additional three upsell / cross sell wins to existing clients."

Kazani also added that while property and casualty segment was the big contributor to growth, they expect life and annuity business to also see growth in the future. US is the biggest market for the company, while India is a small segment, which Kaznani believes will see growth in the next few years.

The company is also open to small acquisitions to build capability. He said that digital data and content would an area of focus to build capability, where even small acquisitions would be looked into.

The total active client count as of September 30, 2015 was 155 as compared to 152 as on June 30, 2015. The product research & development spends during the quarter stood at Rs 28.1 crore (14.9% of total income) as compared to Rs 20.3 crore (13.1% of total income) in Q1 FY16.

Ketan Mehta, Non - Executive Director, Majesco & CEO, Majesco (US) explained that during the second quarter, they completed the integration of Cover-All Technologies.

"QBE, one of the world's 20 largest insurance and reinsurance companies, has selected Majesco to build a strategic platform for their speciality division. This engagement will be implemented on Majesco's cloud offering which is the growing part of our business," he said.