Happiest Minds Technologies Confident Of Double-Digit Growth In FY26 On Strong Order Pipeline

Happiest Minds Technologies Ltd. is confident of achieving a double-digit growth in the financial year 2026, supported by a strong deal pipeline, Co-Chairman and Chief Executive Officer Joseph Anantharaju said on May 13. Speaking to NDTV Profit, he noted that improving clarity in US-China trade tensions should boost manufacturer confidence.

The Bengaluru-based IT services company has a major presence in the United States market.

"So, our expectation is that by the end of Q1 or Q2, we should see things settling down. As far as customers are concerned, by and large, we have not seen any customers pull back. They may have paused some of their investments or slowed them down,” Anantharaju said.

Explaining the recent slip in Ebitda (from 21.1% to 19.3% YoY), MD and CFO Venkatraman Narayanan said that it was largely due to a Rs 12.5-crore bad debt provision and a Rs 23-crore one-off adjustment, related to contingent consideration.

"As far as bad debt is concerned, it was one of our larger customers...they had a substantial part of their forecasted business to come from the US, which for some reason did not happen. They ran aground on their payment obligation, which meant we had to stop work in Q4. Despite this, we still showed revenue growth,” Narayanan said.

The management emphasised that, excluding these non-recurring items, the company remains financially strong and within its Ebitda guidance of 20–22%. Narayanan also outlined that the Rs 12-crore bad debt has been fully recognised in the current quarter and no impact is expected in FY26.

“We have completely taken a hit on account of the bad debt. We did business, we started business in Q3. Whatever we built in Q3, we had to take a bad debt. We have done that and immediately stopped business at Q4. So, all the actions to be taken have been taken,” he added.

Happiest Minds missed its FY25 constant currency revenue growth guidance of 28–30%, achieving 26%. "So, we are 2% shy of the forecast and the reason for that is we lost about 40 days in the consolidation of our acquired companies. The second is the sudden drop in revenues from this one customer, who had ramped up nicely in Q3. These and various other geopolitical aspects hit us by that 2-3% that we thought we would do over Q2 and Q3 of the year, which didn't happen," Narayanan said.

In the quarter ended March 2025, the company’s revenue grew 30.5% to Rs 544.5 crore, compared to Rs 417.29 crore in the year-ago quarter. The company’s Ebitda stood at Rs 109.8 crore, marginally up from Rs 108.22 crore in Q4 FY24. Its net profit dropped 52.8% YoY to Rs 34 crore in Q4, compared to nearly Rs 72 crore in the same quarter a year ago.

Shares of Happiest Minds Technologies were trading 2.84% lower at Rs 592.4 apiece on the NSE at 1:12 p.m. on Tuesday, compared to a 1.17% decline in the NSE Nifty 50 to 24,633.85.