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Tech Mahindra Q4 net up 18% at Rs 897cr, drops payment bank plan -

Tech Mahindra   's fourth quarter consolidated profit increased 18.2 percent sequentially to Rs 897 crore, driven by other income, forex gain and lower tax cost. Revenue rose 2.7 percent to Rs 6,883.7 crore and dollar revenue was up 0.75 percent at USD 1,022.6 million compared to preceding quarter. The company said IT business grew by 3.7 percent QoQ to Rs 6,399.73 crore but BPO segment showed a 8.5 percent degrowth at Rs 484 crore in Q4. The software services provider beat analysts' expectations on bottomline front but revenue and EBIT were in-line. Profit was expected at Rs 751 crore on revenue of Rs 6,831 crore (dollar revenue at USD 1,014 million), according to average of estimates of analysts poll.

Consolidated earnings before interest & tax (EBIT) declined 1.92 percent to Rs 943.6 crore and margin contracted by 65 basis points to 13.7 percent compared to preceding quarter, which were expected at Rs 955 crore and 14 percent for the quarter, respectively. Tech Mahindra said it has earned forex gain of Rs 64.3 crore in Q4 against loss of Rs 9.8 crore in previous quarter and other income grew by 38 percent to Rs 101.6 crore, adding tax expenses fell 32.5 percent to Rs 157.12 crore on sequential basis. Meanwhile, the company's board of directors today decided to drop payment bank plan. It had received approval from the RBI for setting up a payment bank on August 20, 2015. It has recommended a dividend of Rs 12 per share (including special dividend of Rs 6) for the financial year 2015-16. The scrip of Tech Mahindra, which announced earnings after market hours, closed up 0.55 percent at Rs 479.25 on Bombay Stock Exchange.

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