Tech Mahindra reported an increase of 3.33% in top line sales for the Sep-20 quarter at Rs9,371.80cr. The operating profits for the quarter ended Sep-20 were up by 14.82% at Rs1,331cr while the net profits were down 1.33% at Rs1,063.10cr on a yoy basis.
This had a proportionate impact on the margins of the company too. For the Sep-20 quarter, the operating profit margins or OPM expanded by 143 basis points at 14.21% while the net profit margins or NPM for the quarter was down 90 bps at 11.34% due to a sharp fall in the other income component in the top line.
Financial highlights for Sep-20 compared yoy and sequentially
|Particulars||Sep-20 Quarter||Growth (yoy)||Growth (qoq)|
|Key Ratios||Sep-20 Quarter||Sep-19 Quarter||Jun-20 Quarter|
|Net Profit Margin||11.34%||12.25%||10.49%|
Key takeaways from the Sep-20 quarter results
The COVID impact on revenues was not substantial as is evident from the performance in the Jun-20 quarter. However, in the Sep-20 quarter, the other income component fell sharply leading to a fall in net profit despite a rise in operating profit.
In terms of revenue mix, 90% of the revenues came from the IT business while the balance 10% came from the BPO business. Net cash generated from operating activities was up 3-fold in the H1 at Rs4,629cr on favorable trade receivables movement.
The total headcount of Tech Mahindra stood at 1.24 lakhs while the active client list stood at 988 as of Sep-20. To expand its digital portfolio, Tech Mahindra completed the acquisition of Momenton, a digital enterprise technology firm during the quarter.