IT services company Tech Mahindra on Saturday reported a two-fold jump in its consolidated profit to Rs 1,250 crore for the July-September quarter, driven by special income from asset sales.
The Mahindra Group company posted a net profit of Rs 493.9 crore last quarter, according to an exchange filing.
Revenue rose 3.49 percent to Rs 13,313.2 crore in the second quarter of 2024-25 compared to Rs 12,863.9 crore in the same quarter of 2023-24.
“Other income includes a profit on the sale of assets of Rs 4,502 million which includes real estate and related buildings and furniture and equipment sold for an amount of Rs 5,350 million, accrued for a period of four years and interest of 8.2 cent pA,” said the filing company.
Accordingly, net profit increased by 46.81 percent and revenue by 2.36 percent.
“We continue to make progress in our strategic development efforts as the IT services industry as a whole is still soft.
“We are focused on strengthening customer relationships and expanding our partner ecosystem while focusing on operational excellence through the Fortius project, which has resulted in increased margins for the third consecutive quarter,” said Tech Mahindra CEO Mohit Joshi.
The CEO launched Project Fortius in April, a three-year plan to achieve a 15 percent operating margin by focusing on organic growth.
“This quarter we are seeing consistent performance in terms of increased deals, revenue growth, cost optimization and free cash generation as we continue our journey towards FY27 targets. In line with our dividend policy the board has declared an interim dividend of Rs 15 per share,” said Tech Mahindra CFO Rohit Anand.
The company’s TCV (Total Contract Value), or total new deal wins, stood at USD 603 million in the second quarter of FY25.
Joshi went on to say that the company is on the right track for long-term sustainable changes, with its leading indicators moving in the right direction, and its ‘Scale at Speed’ narrative resonates in the market.
“We have invested in strengthening the capabilities of service lines by expanding leadership and investing in technical experts.
“We continue to invest in strengthening our new recruitment system, building the right mindset and future skills with partners, by building skills in AI-first and cloud-first skills sets,” he told reporters.
The investment will continue in creating and sustaining a results-driven learning organization and cultivating an efficient culture based on the principles of simplification, clarity, innovation and driving high performance orientation, he added.
This year may be turbulent because we are in a phase of change, said Joshi.
“I am confident, however, that the platform is set to trade for the long term, which is important because of a high-quality and cohesive leadership team and a clearly defined strategic plan,” Joshi said.
The Pune-headquartered company added 6,653 employees during the quarter under review, taking its workforce to 1,54,273.
Shares of Tech Mahindra settled at Rs 1,688 apiece on the BSE on Friday, down 0.68 percent from the previous close.