ICICI Direct: Mindtree’s Robust Deal Wins; Improved Margin Performance In Q1
Mindtree campus in Bengaluru, India. Photographer: Nishant Sharma/BloombergQuint

ICICI Direct: Mindtree’s Robust Deal Wins; Improved Margin Performance In Q1

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BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy

ICICI Direct Report

MindTree reported 9.0% QoQ dip in dollar revenues, mainly led by 54.5% dip in travel and hospitality revenues. However, cost efficiency, rupee depreciation led margins to improve by 108 basis point QoQ to 16.9%. In addition, the company has registered healthy deal pipeline, which increased 20.7% YoY.

We believe the company’s strategy to increase the annuity business will provide long term visibility to revenues. In addition, Mindtree’s aim to improve margins via employee pyramid, offshoring, pricing, utilisation and annuity business bodes well for profit growth. Further, the company has changed the forex hedging strategy to a three year period, which will provide better profit after tax margin visibility.

Click on the attachment to read the full report:

ICICI Direct _MindTree_Q1FY21.pdf

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