India’s LTIMindtree posts better-than expected Q2 revenue, profit

BENGALURU (Reuters) – Indian IT services and consulting firm LTIMindtree reported a smaller-than-expected drop in its second-quarter profit on Wednesday, as healthy revenue growth outweighed a rise in employee and other expenses.

The company’s consolidated net profit fell 2.3% to 11.62 billion rupees ($139.6 million) in the July-September quarter, while analysts expected profit would fall to 11.27 billion rupees, as per LSEG data.

LTIMindtree — formed about a year back when Larsen & Toubro’s IT unit merged with Mindtree — said revenue rose 8.2% to 89.05 billion rupees in the quarter, beating analysts estimates of 88.70 billion rupees.

That helped mitigate the effect of an 11% rise in employee-related expenses, and 10% increase in total expenses.

The revenue growth was also strong in comparison to the results of LTIMindtree’s larger peers.

Market leader Tata Consultancy Services posted weaker-than-expected second-quarter revenue last week, while Wipro reported an unexpected drop in revenue earlier in the day.

Wipro also warned it expected the decline in its IT services revenue to accelerate this quarter, while Infosys has cut its full-year revenue forecast saying clients were delaying decision making and cutting discretionary spends.

LTIMindtree, however, recorded a 20% jump in order inflow to $1.3 billion. It also approved a dividend of 20 rupees per share.

The company’s stock closed 1.1% lower ahead of results, compared with a 0.7% fall in the benchmark Nifty 50 index, to which it was added in July. ($1 = 83.2230 Indian rupees)

(Reporting by Kashish Tandon in Bengaluru; Editing by Sohini Goswami)