Tech Mahindra Q2 Results Live: Tech Mahindra shares gain ahead of Q2 results

Tech Mahindra Results Live: Cross-currency headwind likely to be 90 bps

Brokerage house Nirmal Bang expects Tech Mahindra to deliver (-) 1% CC QoQ growth, which will be impacted by weakness in the CME vertical (~40% of sales, which declined by ~9% both QoQ and YoY in 1QFY24). Cross-currency headwind will be ~90 bps. In Q2FY24, we expect TCV to be lower than the guided range of $700 million-1,000 million range after two consecutive quarters of misses.

Tech Mahindra Q2 Preview: Expect muted set of numbers in seasonally strong quarter; here are the key factors to look out

Pune-based IT major, Tech Mahindra Ltd, will report its Q2 results on Wednesday, October 25. So far major Indian IT companies, such as TCS, Infosys, HCL Tech, and Wipro, have announced muted earnings for the July–September quarter (Q2) on the backdrop of ongoing macroeconomic worries. Most of the brokerages expect a soft Q2 for Tech Mahindra with a sequentially drop in revenue and margins. Read full report here

Tech Mahindra Results Live: Key things to watch out for

Expect investor focus on — 

(1) turnaround strategy and implications of recently announced organization structure that will be effective January 2024

(2) timing of divestments of low-margin business that will aid margins but adversely impact revenue growth

(3) outlook for margins in FY2024 noting current level of margins are materially lower than normalized levels and levers that can be flexed to improve margins

(4) margin normalization timelines and aspirational growth and margin levels

(5) outlook for vulnerable segments such as XDS, ERD and network services, which have higher exposure to discretionary spending

(6) health of deal pipeline and positioning in cost take-out deals

(7) any revenue leakage in existing accounts and positioning in vendor consolidation events

(8) outlook for revenue growth in top telecom clients

(9) requests for furloughs in retail vertical and BPO services

Tech Mahindra Results Live: Revenues to remain flat QoQ, deal wins muted: Kotak Equities

We expect revenues to remain flat on a QoQ basis in CC terms with weak performance across communications and enterprise segments. Q1FY24 EBIT margin was impacted by 200 bps due to unanticipated bankruptcy of a client. We forecast a stable adjusted EBIT margin at 8.8%. The company may have one-time costs in the quarter, which is difficult to quantify. Hence, we do not bake the same in our estimates, Kotak Institutional Equities said. 

Deal wins will remain muted due to weak macro and slow decision-making. We forecast net new TCV of $400-500 million. We expect quarterly financials to have limited sway in the near term with focus on turnaround under Mohit Joshi. The recently announced organization structure can lead to a few exits at the leadership levels, it added.

Tech Mahindra Results Live: Net profit likely to fall 3.7% QoQ to ₹666.9 crore

According to Nuvama Institutional Equities’ estimates, Tech Mahindra’s Q2FY24 net profit may fall 3.7% to ₹666.9 crore from ₹692.48 crore, QoQ. The company’s USD revenue may fall 0.9% to $1,587 million from $1,601 million, while revenue in rupee terms may decline 0.3% sequentially to ₹13,119.6 crore.

EBIT in the September quarter is expected to fall 15.9% to ₹749.8 crore from ₹891.4 crore in the June quarter, while EBIT margin is likely to compress by 106 bps to 5.7% from 6.8%, QoQ, on the back of various business restructuring actions.

Tech Mahindra Results Live: Revenue may fall 0.7% QoQ: Nuvama 

Tech Mahindra is expected to report 0.7% QoQ decline in CC revenue and 0.9% decline in USD revenue – driven by weakness in Telecom segment and weak deal flow in earlier quarters. Margins are likely to decline further by 100 bps QoQ on the back of various business restructuring actions. Deal wins are anticipated to be weak YoY as is the overall outlook, said Nuvama Institutional Equities.

Tech Mahindra Results Live: IT companies post muted Q2 earnings 

So far major Indian IT companies, such as TCS, Infosys, HCL Tech, and Wipro, have announced muted earnings for the July–September quarter (Q2) on the backdrop of ongoing macroeconomic worries. Although the second quarter is usually a strong one for this sector, Q2FY24 was expected by the street to be sluggish since discretionary expenditure has been hindered amid macroeconomic uncertainties.

“While the industry has witnessed an uptick in order inflow over the past two months with a focus on cost efficiency, the slowdown in project-based business is expected to hamper overall industry growth,” said brokerage Motilal Oswal Financial Services in its report.

Tech Mahindra Results Live: Tech Mahindra, Axis Bank, Jubilant Foodworks, others to announce Q2 results today

Approximately 45 companies will release their September quarter results today. Investors are focused on major players like Tech Mahindra Ltd, Axis Bank Ltd, Jubilant Foodworks Ltd, Welspun India Ltd, Network18 Media & Investments Ltd, and Indus Towers Ltd. Read full report here

Tech Mahindra Results Live: Tech Mahindra shares gain ahead of Q2 results

Tech Mahindra share price opened higher ahead of the release of Q2 results today. Tech Mahindra shares opened marginally higher at ₹1,158.00 apiece as against its previous close of ₹1,155.15 apiece on the BSE. The stock price rose 0.88% to ₹1,165.40 apiece.

Tech Mahindra Results Live: Board to consider dividend

Tech Mahindra’s board of directors today will also consider a recommendation for the interim dividend payment for the fiscal year 2023–2024. The record date to determine the members eligible to receive the interim dividend, if approved by the board, is set by the company for Thursday, November 2.

Tech Mahindra Results Live: IT major to announce Q2 results today

Pune-based IT major, Tech Mahindra Ltd, will report its Q2 results today, October 25. For the fiscal year 2023–2024, the board of directors will also consider a recommendation for the interim dividend payment. The record date to determine the members eligible to receive the interim dividend, if approved by the board, is set by the company for Thursday, November 2.