Mindtree posts strong growth in Q4, says confident about FY17

BENGALURU: Mid-cap software services firm Mindtree, which counts the likes of Microsoft and US-based insurance giant American International Group (AIG) among its top customers, posted an 11 per cent rise in net profit, helped mainly by higher spending from clients and favorable currency fluctuations, and said it expects momentum to continue in the 2016-17 fiscal year.

For the January-March quarter, Mindtree posted a profit of $23 million, an 11 per cent jump from last year. Revenue surged 32 per cent to $195.6 million.

"FY16 has seen industry leading growth of 22.5 per cent for Mindtree. We are confident that our strategic roadmap with digital and managed services as underlying themes backed by expert teams will help us deliver superior results going forward," said Rostow Ravanan, CEO of Mindtree, in a statement.

For the full year, Mindtree reported revenue growth of 22.5 per cent, including acquisitions, coming in well ahead of Nasscom’s guidance of 12-14 per cent revenue growth for software exports in the 2015-16 financial year.

Mindtree, which earlier this year undertook its biggest organizational reshuffle in years and appointed Ravanan as CEO with former CEO Krishnakumar Natarajan moving on to the role of chairman, said it had 348 active clients at the end of the year. The company, which was founded in 1999 by former Wipro executives, currently has six $25-million clients and 15 clients in the $10-million bucket. Attrition rates stood at 15.7 per cent.

Mindtree strong performance comes days after larger top-tier rival and India’s second largest software exporter Infosys trumped analyst expectations with a robust fourth-quarter performance and a strong revenue forecast for FY17. On Monday, market leader TCS also reported a quarterly performance that came in marginally ahead of expectations.

Mindtree’s shares closed up 5.7 per cent to Rs 731 on the BSE on Monday.