Happiest Minds Q1 Results: Growth Sustains Amid Marginal Uptick In Profit

Happiest Minds Technologies Ltd. sustained its growth in the first quarter of a fiscal that’s seen as a “year of transition” for India’s $245-billion IT services industry.

Revenue of the Bengaluru-based IT services firm rose 3.41% over the previous three months to Rs 390.87 crore in the quarter ended June 30, according to an exchange filing on Tuesday. That compares with the Rs 300.57 crore consensus estimate of analysts tracked by Bloomberg.

Happiest Minds Q1 Results: Key Highlights (QoQ)

• Revenue up 3.41% to Rs 390.87 crore (Bloomberg estimate: Rs 300.57 crore)

• EBIT down 5.22% to Rs 75.09 crore

• EBIT margin down 175 BPS at 19.21%

• Net profit up 1.16% at Rs 58.33 crore (Bloomberg estimate: Rs 52.11 crore)

In dollar terms, the company’s top line grew 3.6% sequentially to $47.6 million in the April-June quarter. It was up 3.5% in constant currency terms. Free cash flow stood at Rs 101.33 crore.

“We have set a goal of achieving $1 billion by 2031, and our guidance of 25% is based on the same. We remain on target for achieving the goal,” Ashok Soota, executive chairman at Happiest Minds, said in a statement accompanying the earnings.

“In our guidance of 25%, we have not been making a distinction between organic and inorganic growth. In the current year, we have been expecting to make significant acquisitions, which we have not been able to close so far. We will update our guidance target in October based on the M&A progress.”

Happiest Minds added 18 new clients in the June quarter, increasing the overall tally to 243 as of June 30. It added a net 131 employees during the quarter; the overall headcount stood at 5,048. The attrition rate eased 320 basis points to 16.6% on a trailing 12-month basis during the quarter.