Mindtree Q1FY17 consolidated net profit declines 7% qoq to Rs.123.5 crore: Misses Estimates

India Infoline News Service | Mumbai | July 18, 2016 17:30 IST

Mindtree’s revenue stood at Rs.1327.6 crore rising a minimal 0.55% qoq and 35.82% yoy.

MindTree
Mindtree, IT consulting firm, reported a consolidated net profit of Rs. 123.5 crore for the quarter ended 30th June, 2016 registering a decline of 7.14% qoq and 3.74% yoy. The Company’s revenue stood at Rs.1327.6 crore rising 0.55% qoq and 35.82% yoy.

It’s consolidated operating profit of Rs.195.1 crore for the quarter declined 11.56% qoq but rose 16.69% yoy. The operating profit margin for the current quarter came in at 14.70% , declining 201bps qoq and 240bps yoy.

It’s standalone net profit of Rs. 143.4 crore for the quarter, registered a decline of 13.77% qoq but rose 12.29% yoy. The Company’s revenue stood at Rs.1203.1 crore rising 0.17% qoq and 25.56% yoy.

It’s standalone operating profit of Rs. 196.6 crore for the quarter declined 13.39% qoq but rose 19.44% yoy. The operating profit margin for the current quarter came in at 16.34%, declining 255bps qoq and 83bps yoy.

Mindtree  Q1: A miss on all fronts!
Mindtree posted a disappointing set of numbers. It’s consolidated revenue for the quarter stood at Rs. 1327.6 crore vs. the IIFL estimate of Rs. 1358.2, lagging the estimates by 2.25%. The IT consultant posted a consolidated net profit of Rs 123.5 crore vs. IIFL estimate of Rs. 162.2 crore missing estimates by 23.86%. The operating profit margin (OPM) of 14.7% also disappointed vs. IIFL estimate of 17.3%. The margins to some effect were affected due to higher employee benefit expenses of Rs. 836.6 crore, which rose 2.17% qoq. Meanwhile, company’s top-line was mainly impacted by the fall in the BFSI segmental revenue by 2.32% qoq at Rs. 330.6. On the positive side, the company managed to make a forex gain of Rs. 88 crore rising 83.87% qoq.
The trailing 12 months attrition rate stood at 16.5% for the quarter ended June 30, 2016. The company has 343 active clients as on June 2016 and added one client in the $10 million category, taking the total count to 16.

Result Highlights: (Rs. in crore)

Reported Results

IIFL Estimates

Variance (%)

Consolidated Revenue

1327.6

1358.2

[2.25]

Consolidated Net Profit

123.5

162.2

[23.86]


Consolidated EPS for the quarter ended June 30, 2016 stood at Rs.7.35.
Management Commentary:
“The ongoing market transition to everything as a service, bundled management services and digital transformation is right in our sweet spot, while the global environment poses some short term challenges, we remain confident that that our investments are on the right track to accelerate growth for our clients and Mindtree.” said Rostow Ravanan, CEO & Managing Director, Mindtree.

Stock Commentary:
Mindtree Ltd ended at Rs. 613.8, down by Rs. 23.95 or 3.76% from its previous closing of Rs. 637.75 on the BSE.
The scrip opened at Rs. 634.9 and touched a high and low of Rs. 635.25 and Rs. 610.5 respectively. A total of 2118650(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs. 10703.41 crore.
The BSE group 'A' stock of face value Rs. 10 touched a 52 week high of Rs. 803.5 on 04-Mar-2016 and a 52 week low of Rs. 595 on 16-Jul-2015. Last one week high and low of the scrip stood at Rs. 669 and Rs. 634 respectively.
The promoters holding in the company stood at 13.72 % while Institutions and Non-Institutions held 48.09 % and 38.19 % respectively.
The stock traded below its 200 DMA.

***Note: This is a NSE Chart

 

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