L&T Infotech Limited, one of the leading IT services providers of the country, on October 18 reported consolidated profit after tax (PAT) of Rs 552 crore for the quarter ended September 2021, up 11.1 percent from Rs 497 crore logged in the previous quarter. On a year-on-year (YoY) basis, the numbers grew 20.8 percent from Rs 457 crore.

Consolidated revenue came in higher at Rs 3,767 crore, an increase of 8.8 percent compared to Rs 3,462.5 crore in the June 2021 quarter. On annual basis, growth in revenue was 25.6 percent from Rs 2,998 crore.

Dollar revenues for the quarter were at $509 million, a growth of 8.3 percent QOQ and 25.8 percent YOY. Constant currency revenue gave 8.9 percent QOQ growth and 25.5 percent on a YOY basis.

Revenues have grown on the back of the growth momentum of Q1FY22 which has continued in this quarter, healthy deal signings, and broad-based growth across verticals and geographies.

The company had healthy deal signings and strong pipeline and added 1 client in $50 million+ basket, 3 clients in $20 million+ category, 5 clients in $10 million+ category, 5 in $5 million+ category and 11 in $1 million+ category. The company was able to add 25 new clients in this quarter taking the tally of its active clients to 463.

The top five clients contributed 28.2 percent to the revenues, a growth of 8.1 percent QOQ. 40.7 percent came from the top 10 clients with a QOQ growth of 6.8 percent and the top 20 clients contributed 55 percent to the revenues, showing a growth of 7.8 percent QOQ.

BFSI continued to be the largest contributor to the revenues with a 32.5 percent share, followed by distant manufacturing at 15.6 percent, insurance at 14.2 percent, high tech, media & entertainment at 12.5 percent, and CPG, retail & pharma at 10.7 percent. Energy & utilities and others constituted the balance 15 percent share of revenues.

With the increase in economic activities, manufacturing witnessed the highest QOQ growth of 12.4 percent and a YOY growth of 20.8 percent. Traditional performer, BFS grew 9.6 percent QOQ and 36.8 percent YOY. Other verticals also grew with decent single-digit growth on a QOQ basis.

The company’s service offerings in enterprise integration and mobility fields increased handsomely with 16.2 percent QOQ growth and 41.3 percent YOY growth. Service offerings in analytics, AI & cognitive fields also witnessed a healthy growth of 11.9 percent QOQ and 43.7 percent YOY. Barring cloud infrastructure & security which grew by a mere 1.9 percent QOQ, ADM & testing, and enterprise solutions grew by 8.7 percent and 7.2 percent, respectively on a QOQ basis.

The company witnessed an all-around growth across geographies with the rest of the world (ROW) growing the most at 10.6 percent QOQ and 50.5 percent YOY. North America continued to be the biggest contributor to the revenues with 67.5 percent revenues. It witnessed a growth of 8.9 percent QOQ and 23.5 percent YOY. Europe and India grew by 5 percent and 6 percent, respectively on a QOQ basis.

The company’s total headcount stands at 42,382 which is a 31 percent increase from the previous year and 11 percent higher than the previous quarter.

Despite the increase in wages and paying higher retention costs, the attrition at the company stands quite high at 19.6 percent compared to 15.2 percent last quarter and 13.5 percent last year.

“We are witnessing strong demand and are rapidly scaling up on the supply-side with our headcount up 31 percent year on year”, Jalona added.

The company reported an EBITDA of Rs 733.2 crore, a growth of 13.2 percent on Rs. 647.8 crores reported in the previous quarter and a growth of 7 percent from Rs 685.6 crore reported last year.

Due to the impact of supply-side pressure and higher employee cost, the EBITDA margins witnessed a decline of 340 bps to 19.5 percent compared to 22.9 percent last year. However, the EBITDA margin improved marginally by 80 bps compared to the previous quarter's margin of 18.7 percent.

Net margin declined 60 bps from 15.2 percent last year to 14.6 percent this quarter. The previous quarter's net margin was 14.3 percent.

EPS grew 11 percent QOQ to Rs 31.5/share from Rs 28.4/share and grew by 21 percent YOY from Rs 26.1/share.

The stock closed at Rs. 5,905.85 today, down 3.2 percent (Rs. 193.0) from its previous day’s close. It has generated returns of 92 percent over the past year, 61.38 percent in this financial year, 37.7 percent during the last 3 months, and 3.33 percent in the past month.

The company has declared an interim dividend of Rs 15/share of face value of Re.1 each fully paid-up . October 26, 2021, is the record date fixed for the same.