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Informist, Thursday, Jan. 23, 2025

 

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--Mphasis Oct-Dec consol net profit INR 4.28 bln 
--Analysts saw Mphasis Oct-Dec consol net profit INR 4.15 bln 
--Mphasis Oct-Dec consol net profit INR 4.28 bln vs INR 4.23 bln qtr ago 
--Mphasis Oct-Dec consol revenue INR 35.61 bln vs INR 35.36 bln qtr ago 
--Mphasis Apr-Dec consol net profit INR 12.56 bln vs INR 11.62 bln year ago 
--Mphasis Apr-Dec consol revenue INR 105.20 bln vs INR 98.66 bln year ago 
--Mphasis Oct-Dec direct revenue up 0.2% on qtr in constant currency terms 
--Mphasis Oct-Dec total new contract wins $351 mln 
--Mphasis Oct-Dec operating margin 15.3% 
--Mphasis Oct-Dec BFS pipeline up 58% on year, non-BFS pipeline up 44% on yr 
--Mphasis won 5 large deals in Oct-Dec 
--Mphasis Oct-Dec operating margin 15.3% vs 15.4% qtr ago

 

By Arya S. Biju

 

MUMBAI – Mphasis Ltd. Thursday reported better-than-expected earnings for the December quarter, with both top line and bottom line showing marginal growth sequentially. Analysts had expected the company to report a fall sequentially in both the metrics due to impact of furlough.

 

The information technology company's consolidated net profit for the December quarter grew 1% sequentially to INR 4.28 billion, beating analysts' expectation of INR 4.15 billion. This marked the fourth consecutive quarter of net profit growth for the company. The consolidated revenue of the company grew marginally on quarter to INR 35.61 billion, marking the sixth consecutive quarter of revenue growth. Analysts had expected the company to report a consolidated net revenue of INR 35.17 billion. On a year-on-year basis, the company's consolidated net profit grew around 15% and its revenue grew around 7%.

 

For the nine months ended December, Mphasis reported a consolidated net profit of INR 12.56 billion, up 8% from INR 11.62 billion a year ago. Consolidated revenue for the same period was INR 105.20 billion, up around 7% from INR 98.66 billion.

 

Direct revenue of the company for the quarter in constant currency terms grew 0.2% sequentially. In constant currency terms, revenue from the banking and financial services segment grew 1.6% on quarter, while the insurance segment revenue grew 4.4%. The technology media and telecom segment of the company reported sequential revenue growth of 3% in constant currency terms.

 

Revenue growth in the banking and financial services segment for the quarter was on account of wallet share gains, the company said in its investor presentation. Mphasis also witnessed a gradual recovery in its mortgage business in the quarter. Continued deal wins and conversions drove revenue growth in the technology segment for the December quarter, the company said. Revenue in constant currency terms of the logistics and transportation segment, however, fell 7% sequentially. 

 

Total expenditure of the company for the December quarter rose marginally on quarter to INR 30.55 billion. Depreciation and amortisation expense rose 28% sequentially to INR 1.32 billion, while its finance cost and employee benefit cost fell on quarter by 3% and 1%, respectively.

 

For the December quarter, Mphasis reported new deals with a total contract value of $351 million, marking the highest total contract value in the last six quarters, the company said. This includes five large deals. The company classifies large deals as those with a total contract value of more than $20 million. The deal wins for the quarter were broad-based across verticals, client pyramid, and archetypes, Mphasis said. The quarter also saw an increase in the pace of conversion of total contract value to revenue, the company said.

 

"We continue to stay focused on driving deal activity and closures, as we get on the other side of the macro cycle... With the infusion of our NeoZeta and NeoCrux AI (artificial intelligence) platforms, we are witnessing a considerable uptick in AI adoption, as evidenced in our deal wins and pipeline growth," Nitin Rakesh, chief executive officer and managing director of the company, said in a press release. The company's large deal pipeline grew 49% on quarter. The banking and financial services deal pipeline grew 58% on year, while the non-banking and financial services pipeline was up 44% on year. 

 

The operating margin or earnings before interest margin for the quarter declined to 15.3% from 15.4% in the previous quarter. This was within its target band of 14.6%-16.0%. Going forward, the company said it aims to maintain its operating margin within the target band. 

 

On Thursday, shares of the company closed at INR 2,918.95 on the National Stock Exchange, up almost 4%. The company detailed its earnings for the December quarter after market hours.  End

 

US$1 = INR 86.45

 

Edited by Ashish Shirke

 

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