Mphasis Stock Soars on Strong Outlook

17 Oct 2024 , 11:39 AM

Mphasis Ltd. shares rose more than 4% on Thursday, October 17, after the business reported higher-than-expected revenue and profits for the September quarter.

The Bengaluru-based company posted a higher Earnings Before Interest and Tax (EBIT) of ₹544.2 crore compared to ₹513.5 crore in the June quarter.

EBIT margin was 15.4%, exceeding the expected 15.1%. Mphasis reported a net profit increase of 4.6% sequentially to ₹423.3 crore.

Net revenue increased by 2.4% quarter-over-quarter in constant currency to ₹3,540 crore, exceeding the predicted 1.8% growth rate.

The TMT vertical expanded by 5.6% sequentially, while the BFS business increased by 3.2% from the previous June quarter.

In a post-earnings call, Mphasis management stated that the total pipeline has climbed by 23% year on year and by single digits quarter on quarter. The company acquired six significant contracts in the first half of this fiscal year, and deal-to-revenue conversion is expected to increase in the future.

The company expects the third quarter to follow usual seasonal trends, with the BFS category leading growth. In addition, its FY25 margin guidance range of 14.6% to 16% remains unchanged.

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