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Zensar Tech shares near 52-week low after margin contracts for seven straight quarters

Zensar Tech shares near 52-week low after margin contracts for seven straight quarters

Zensar Tech shares near 52-week low after margin contracts for seven straight quarters
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By CNBCTV18.com Oct 21, 2022 1:16:11 PM IST (Published)

Three of the company's highest revenue generating business dragged during the September quarter, thereby hurting earnings.

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Shares of Zensar Technologies are trading near their 52-week low on Friday after the company reported a weak September quarter after its EBITDA margin contracted for the seventh straight quarter.
For the quarter under review, Zensar's margin contracted by 280 basis points to a single-digit figure of 8.5 percent. Wage hikes undertaken during the quarter hurt the company's margin.
In fact, the company's margin has more than halved starting from the March quarter of the financial year 2021, when it stood at 19.65 percent.

Zensar's revenue in US Dollar terms declined 0.6 percent compared to the June quarter, while net profit declined by a quarter. Constant Currency revenue growth of 1.6 percent was also lower than peers.

The management said that the company witnessed softness in the Hi-Tech, Manufacturing, and Consumer Services business due to a sluggish macroeconomic environment. The three businesses together contribute nearly 70 percent of the overall revenue.

On the positive, the company's deal wins increased nearly 14 percent from the June quarter to $141.8 million.

Shares of Zensar Technologies are down 1.5 percent at Rs 218.50. Shares are down nearly 60 percent this year.

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