Mahindra Satyam Q4 profit at Rs 534.21 cr on higher revenues

Reaps benefit of 1.3 per cent on currency rate

PTI | May 18, 2012



IT firm Mahindra Satyam on thursday reported a net profit of Rs 534.21 crore for the fourth quarter ended March 31, 2012, driven largely by higher revenues and increased employee efficiency rates.

The city-based company had suffered a net loss of Rs 327 crore in the January-March period of 2011.

The company's consolidated revenues during the quarter grew at 21 per cent to Rs 1,666 crore as compared to Rs 1,375 crore for the same period last fiscal.

"This quarter we had a benefit of 1.3 per cent on currency rate. The growth was largely volume driven. Efficiency levels are also pretty significant in this quarter," Mahindra Satyam CFO Vasant Krishnan said.

On the outlook for the current fiscal, company's Chairman Vineet Nayyar said though the global economic situation appears to be bleak at this point of time, the company would try to maintain the current level of growth.

"Economic prognosis at this point time is uncertain. There are large numbers of contradictions in Europe. This is going to have an impact on business, especially on spend. And I also said normally whenever affluent countries come under pressure and need to economise, they do turn to suppliers like us," he said.

With larger peers like Infosys and Wipro giving muted guidance lower than Nasscom's guidance, while Cognizant slashed its annual revenue forecast, there are concerns about the health of the Indian IT outsourcing industry.

Industry body Nasscom has forecast the sector's growth at 11-14 per cent for this fiscal.

Exuding confidence in the company's capabilities, Nayyar said, "There are forces at work and it is our hope, not promise, that we will be able to continue with the current level of growth."

For the full year ended March 31, 2012, Mahindra Satyam has registered a net profit of Rs 1,306 crore as against a loss of Rs 147 crore in 2010-11.

Revenues in the reported fiscal stood at Rs 6,395.6 crore, up 24.3 per cent from Rs 5,145.1 crore in FY'11.

Satyam Computer Services came at the centre of a massive accounting fraud perpetrated by its founder Chairman B Ramalinga Raju in 2009. The firm, which was later taken over by Tech Mahindra, has since been rebranded as Mahindra Satyam.

According to Nayyar, the company has fully recovered from all the issues and the results establish that.

"The not so good news is now we do not have alibi, the management is required to deliver quarter to quarter because we cannot take the excuse anymore," Nayyar added.

On employee metrics, Krishnan said Mahindra Satyam has added 1,073 people in the quarter at the foot level, which has helped talent expansion significantly.

"In this quarter, we have added 1,073 employees at the base of the pyramid. And that again resulted in talent expansion of 32.7 per cent at the base," he said.

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