Mindtree Q3 Review: Margin Beat, Raise Cycle Seems To Be Over, Says ICICI Securities
Mindtree campus in Bengaluru, India. (Photographer: Nishant Sharma/BloombergQuint)

Mindtree Q3 Review: Margin Beat, Raise Cycle Seems To Be Over, Says ICICI Securities

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

ICICI Securities Report

Besides transient Covid-19 led tailwinds, Mindtree Ltd.’s margin expansion was aided by sustainable and structural changes in costs.

While we expected parity with cost structure of Larsen and Toubro Ltd. by FY23E, the convergence has happened earlier! As some of the operational metrics (e.g. utilisations, salary costs) recalibrate towards their new normal, margins are more likely to contract (than be stable or increase).

Incrementally, as investor focus shifts from mere cost structure correction to growth, we see limited margin of safety for disappointments given the favourable FY21 base.

Click on the attachment to read the full report:

ICICI Securities MindTree Q3FY21 Result Update.pdf


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