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earnings | IST

5 large-cap IT companies have reported Q1FY22 earnings; how they fared?

Tech Mahindra has reported a strong performance for Q1. Revenue has come in at about $1400 million, it is ahead of expectations with the highest growth in the past six quarters. Net profit at Rs 1,350 crore beats the expectation and so is the EBIT margin, which has dropped to 15.2 percent.

Tech Mahindra has reported a strong performance for Q1. Revenue has come in at about $1400 million, it is ahead of expectations with the highest growth in the past six quarters. Net profit at Rs 1,350 crore beats the expectation and so is the EBIT margin, which has dropped to 15.2 percent.
With this, all the five large IT companies have reported their earnings. It is a robust revenue growth that large cap IT companies have reported, driven by accelerated digital transformation seen across companies as well as a strong spending environment on digital.
The leader in the large cap space is Wipro, both reported as well as on organic basis. But Infosys, as well as Tech Mahindra, has reported a very strong beat compared to expectations. In fact, Infosys went ahead and upped its full-year guidance from 14 percent to 16 percent, while HCL Technology continued to maintain its guidance of double-digit revenue growth.
One trend that we need to monitor is going to be on deal wins. This quarter, barring Infosys, all the large cap IT companies have reported a decline in their deal. So the question is were the strong deal wins in Q3 and Q4 on the back of pent-up demand, this is something that we will be tracking.
Also, there is the so-called war for talent and it is getting reflected in very high attrition numbers. So barring TCS, which is single-digit attrition numbers at 8.6 percent, all the others on average have reported a near 300 basis points increase in the attrition rates this quarter.