Tech Mahindra today reported 7.4 per cent rise in net profit to Rs 276 crore for the third quarter ended December 31 and said gains from rupee depreciation were off-set by fall in revenues from British Telecom (BT), which holds stake in the Indian IT firm.
"The rupee depreciation and currency tailwinds helped us. But the impact was not felt because revenues from British Telecom went down. We also had a few projects in transition," Tech Mahindra Vice-Chairman, Managing Director and Chief Executive Vineet Nayyar said.
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In the third quarter of the last fiscal, the company had reported net profit Rs 257 crore. The Mahindra Group firm said its profit in both the quarters are not comparable as the figures in respect of 2010 did not include its share in the profit of its fully-owned subsidiary Satyam Computer.
"We have bagged a large outsourcing deal related to telecom from Australia. We can see similar opportunities coming up in Qatar and Indonesia. Growth from Europe has come down, but this is merely a periodic cycle," he said.
The company's income from operations rose to Rs 1,444.87 crore during the quarter under review as against Rs 1,211.14 crore in the same period last year.
Nayyar said he expects the European crisis to result in more business opportunities for the company, which makes software and billing systems mostly for the telecom industry.
"The company's business deal with Etisalat is protected by a bank guarantee. It is also a global cash-rich company which operates in several countries. We have to wait and watch what Etisalat's options are here and if cancellation of the (2G) licences will affect them in any way. But at the moment, we continue to do business with them," he said.
He said the drop in Ebitda margin is largely due to challenges with large customers and also because the company's capacity utilisation was lesser than last year.
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