Tech Mahindra Q1 Preview: Revenue may fall 2% YoY on seasonal impact; deal wins to be muted
Tech Mahindra is likely to see a muted revenue growth in the first quarter ended June 2024, impacted by seasonal fall in Comviva business.
Revenue for the reporting period should decline 1.6% year-on-year, according to an average estimate of four brokerages. Meanwhile, sequential revenue growth is seen anywhere between 0.3-0.9%.
Reported net profit for the April-June 2024 period is seen jumping 24% year-on-year, an average estimate of four brokerages showed.
Deal wins for the quarter will continue to be muted due to macro uncertainty with TCV expectations pegged at $500 million.
Key things to watch out for include commentary on demand and banking and telecom verticals, large deal wins and progress on margin improvement trajectory.
Nomura
We expect CC growth of 0.5% quarter-on-quarter. Seasonal decline in Comviva business will be offset by growth in enterprise business. We expect adj. EBIT margins to expand by 100 bps quarter-on-quarter.
Prabhudas Lilladher
We expect revenue growth (0.3% CC quarter-on-quarter) to be impacted by seasonality in Comviva business, otherwise the enterprise business is expected to outpace the growth of the communication business. We expect modest recovery in margins by 30 bps quarter-on-quarter in Q1 due to missing operating leverage, which implies more heavy lifting for the rest of the year.
Motilal Oswal
Revenue growth is expected to be muted at 0.4% quarter-on-quarter CC; while communications vertical has bottomed out, recovery could take longer. Deal wins are likely to be
