Mphasis rallies 9% on in-line June quarter earnings, new deal win

Shares of Mphasis rallied 9 per cent to Rs 1,072 on the BSE on Friday after the company’s April-June quarter (Q1FY21) earnings came in-line with Street estimate. Besides, signing of new deal worth $216 million deal in July 2020, in addition to the Q1 TCV declared wins worth $259 million, boosted sentiment.

In constant currency terms, the company’s revenues fell 4.6 per cent quarter on quarter (QoQ) to $305 million. The earnings before interest tax (EBIT) margin, meanwhile, contracted 60 basis points (bps) QoQ was largely due to a drop in the gross margin (200bp QoQ). Profit after tax fell 22.1 per cent QoQ to Rs 275 crore.

“The company has won new TCV (total contract value) of $259 million (includes one large deal of over $100 million) in Q1FY21, which will drive revenues and margins in coming quarters.