Mindteck (India) Q2 FY27 Results (NSE: MINDTECK)
Signal: Steady quarter
The read
Revenue growth re-accelerated to +3.8% YoY from +2.7% in Q1FY27, but the margin arc weakened sequentially to 7.37% from the prior quarter's 7.81%; the key inflection is geographic, with USA and rest-of-world growth offsetting a 20.4% India decline, while higher subcontracting intensity prevented profit growth.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹105.5 Cr | +3.8% | +1.4% |
| Net profit | ₹7.48 Cr | -1.1% | |
| EPS | ₹2.34 | -0.8% | |
| EBIT margin | 7.37% |
P&L walk
Revenue increased to ₹10,550 lakh, +3.8% YoY and +1.4% QoQ, but EBITDA margin was 7.37%, only +27bps YoY and -35bps QoQ, as technical subcontractor costs rose 21.1% YoY; PAT declined 1.1% YoY to ₹748 lakh.
Segments
The USA and rest-of-world markets drove consolidated growth, with revenue rising 9.4% YoY to ₹4,136 lakh and 10.3% to ₹4,787 lakh respectively, while India revenue fell 20.4% to ₹1,627 lakh; the consolidated PAT of ₹748 lakh was nearly double standalone PAT of ₹378 lakh.
Key positives
- Consolidated revenue grew 3.8% YoY to ₹10,550 lakh, improving from the 2.7% YoY growth reported in Q1FY27.
- USA revenue increased 9.4% YoY to ₹4,136 lakh and rest-of-world revenue increased 10.3% to ₹4,787 lakh, offsetting India's 20.4% decline.
- Employee cost intensity improved to 59.4% of revenue from 61.5% YoY, while consolidated operating margin remained positive at 7.37%.
- H1 consolidated operating cash flow was ₹931 lakh versus ₹891 lakh YoY, while H1 capex remained modest at ₹24 lakh.
Key concerns
- PAT declined 1.1% YoY to ₹748 lakh despite 3.8% revenue growth, showing that growth is not yet translating into earnings expansion.
- Technical subcontractor costs rose 21.1% YoY to ₹2,773 lakh and increased to 26.3% of revenue from 22.5%, offsetting the benefit from lower employee-cost intensity.
- Operating margin fell 35bps sequentially to 7.37% from 7.72% in the immediately preceding quarter, reversing part of the prior quarter's improvement.
- India revenue declined 20.4% YoY to ₹1,627 lakh, leaving growth dependent on overseas markets.
Research and educational content only. Not investment advice.