LTIMindtree Q2 net profit declines as profit margin contracts
Oct 19, 2023, 10:42 IST
The country's sixth biggest IT services company by revenues, LTIMindtree, reported a decline in September quarter net profit at Rs 1,162 crore. The city-headquartered company had a net profit of Rs 1,189 crore in the year-ago period, and the same stood at Rs 1,152 crore in the preceding June quarter.
Its overall revenues grew 8.2% to Rs 8,905 crore for the reporting quarter, from Rs 8,228 crore in the year-ago period and Rs 8,702 crore in the June quarter.
However, there was a sharper contraction in the operating profit margin to 16%, as against 17.5% in the year-ago period, which seems to have been the biggest reason for the decline in the overall profits.
The company's managing director and chief executive Debashis Chatterjee said the margins were impacted by the wage hikes given out from July 1, and exuded confidence of gains on the same to exit the fiscal year at 17-18%.
He said the company is not witnessing any pressures on margins despite the volatile economic environment at present.
Deal pipeline is also flowing, and the company reported new wins of USD 1.3 billion for the reporting quarter, he said, adding that discretionary demand is being replaced with long-term engagements focused on cost optimization.
The overall employee base increased to 83,532 at the end of September, which was up from 82,738 in June, but down from 86,936 in the year-ago period.
Chatterjee said 1,400 freshers joined in the reporting quarter, and the attrition is stable at 15.2%.
The company will be training 10,000 of its employees on artificial intelligence in the December quarter, Chatterjee said, adding that it is already engaged in 20 projects which have generative AI components in it.
The company scrip closed 1.11% down at Rs 5,156.90 a piece on the BSE, as against a correction of 0.83% on the benchmark.
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Its overall revenues grew 8.2% to Rs 8,905 crore for the reporting quarter, from Rs 8,228 crore in the year-ago period and Rs 8,702 crore in the June quarter.
However, there was a sharper contraction in the operating profit margin to 16%, as against 17.5% in the year-ago period, which seems to have been the biggest reason for the decline in the overall profits.
The company's managing director and chief executive Debashis Chatterjee said the margins were impacted by the wage hikes given out from July 1, and exuded confidence of gains on the same to exit the fiscal year at 17-18%.
He said the company is not witnessing any pressures on margins despite the volatile economic environment at present.
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The overall employee base increased to 83,532 at the end of September, which was up from 82,738 in June, but down from 86,936 in the year-ago period.
Chatterjee said 1,400 freshers joined in the reporting quarter, and the attrition is stable at 15.2%.
The company will be training 10,000 of its employees on artificial intelligence in the December quarter, Chatterjee said, adding that it is already engaged in 20 projects which have generative AI components in it.
The company scrip closed 1.11% down at Rs 5,156.90 a piece on the BSE, as against a correction of 0.83% on the benchmark.