MindTree hits record high post Q2 results; Elara Global, Morgan Stanley raise target

MindTree surged to a fresh record high of Rs 4799.55 in early trade on the BSE, a day after the mid-cap IT major reported better than expected second-quarter earnings for the financial year 2021-22.

MindTree posted a consolidated net profit at Rs 398.9 crore, up 16.2 per cent sequential and 57.2 per cent year-on-year basis, while its revenue grew by 12.9 per cent QoQ and 34.3 per cent YoY to Rs 2586.2 crore in the June-September quarter of FYY, the company said in the results filing through exchanges.

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The revenue growth in Q2 is reported to be the highest for a quarter in a decade. Moreover, the revenue in the dollar terms grew 12.7 per cent QoQ and 34.1 per cent YoY to Rs $350.1 million in the Q2FY22.

The mid-cap category IT firm’s Board of Directors at its meeting held on October 13, 2021, has declared an interim dividend of 100 per cent (Rs 10 per equity share of par value Rs 10 each).

Mindtree has 263 active clients as of September 30, 2021; while $5 million+ clients grew by 3, a total 50 and $10 million+ clients grew by 5, a total 30, the company said in highlights on Wednesday.

Mindtree’s growth visibility is strong supported by over 24 per cent TCV growth in H1FY22, despite the sequential dip on account of renewal seasonality in Q1.

“Mindtree’s focus on cross-selling-up-selling and more annuity deals is reflected in its client bucket progression as also broad-basing of growth profile (versus high dependence on T1 earlier),” added the Elara Global report.

Mindtree’s expanded portfolio (healthcare vertical), Europe investments, and deeper partnerships with hyperscalers/cloud providers (Salesforce, Adobe) are driving growth.

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