Mumbai: Tech Mahindra Ltd, India’s No. 5 software firm, on Thursday said quarterly profit fell 59%, missing market estimates mainly due to losses related to Satyam Computer.
Earlier this week, Mahindra Satyam, which Tech Mahindra bought in 2009, reported a quarterly net loss. It was hurt by a one-time expense due to settlement of a US shareholder lawsuit. The results sent its shares down as much as 6%.
Tech Mahindra, a unit of tractor and utility vehicle maker Mahindra & Mahindra (M&M), expects pricing to be stable and trending higher, chief financial officer Sonjoy Anand told a media briefing.
The company added 4,125 staff and 15 new clients during the quarter.
Bigger local rivals such as Infosys, Tata Consultancy Services and Wipro have all sounded caution about surging wages and currency volatility with forecasts from Infosys and Wipro disappointing investors.
Tech Mahindra reported net profit of Rs922 million for the fiscal fourth quarter ended March, compared with Rs227 crore a year ago.
According to Thomson Reuters I/B/E/S, analysts, on average, expected net profit of Rs190 crore for the company, which counts BT Group and US telecom giant AT&T as clients.
Mahindra Satyam, earlier called Satyam Computer, was bought by Tech Mahindra after being hit by what became India’s biggest corporate fraud.
Ahead of the results, the shares closed 0.3% lower in a firm Mumbai market. They have dropped 6.4% this year compared with a 12% loss in the wider market.