Bangalore: Information technology services company MindTree Ltd posted nearly double-digit revenue growth for the three months ended 30 September, crediting it to a sharper business focus.
The company crossed the $100 million mark in quarterly sales for the first time as revenue grew 9.5% from the June quarter to $101.3 million. In rupee terms, it grew 10.6% over the preceding quarter to Rs 456 crore.
Net profit grew 56.8% over the preceding quarter and 142.3% over a year earlier to $12.1 million, helped by improved pricing realizations and operational efficiencies, the company said. In rupee terms, net profit grew 58% over the preceding quarter and 135% over a year earlier to Rs 54.5 crore.
Mindtree Campus in Bangalore. By Hemant Mishra
MindTree has focused on servicing manufacturing, media and entertainment and consumer and packaged goods segments from the beginning of this fiscal year.
Both IT services and product engineering services reported excellent growth, chief executive officer and managing director Krishnakumar Natarajan said. “We were also able to improve margins. The change in strategy to focus on a few chosen segments has been validated. Our aspirational target is $1 billion in revenues,” he said. Margins improved to 12.8% compared with 11.2% in the preceding quarter and 11.7% over the year-ago period, the company said.
“The results were positive all around,” said senior research analyst Shashi Bhushan at the brokerage Prabhudas Lilladher. “Definitely the change in strategy of a sharper focus on segments they are strong in, was one of the contributing factors.”
MindTree added 1,478 employeees during the quarter, taking its headcount to 10,580. Attrition came down to 21.7% from 25.6% at the end of the preceding quarter, Natarajan said.
MindTree became the fastest Indian IT services company to post $100 million in annual revenue, achieving the feat in 2005-06, the sixth year of its operation.
Third quarter growth is expected to be muted. It is traditionally a weak period, and the company’s product engineering services business, which contributes about 35% of revenue, may face some headwinds from global macroeconomic conditions, Natarajan said.
The results were declared after market hours on Monday but the MindTrees stock, in anticipation of good results, closed 1.92% up at Rs 386.6. The benchmark Sensex closed 0.34% down to 17,025 points.