Mastek Profit Jumps 11% Despite Revenue Dip; ₹8 Dividend Declared

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AuthorVihaan Mehta|Published at:
Mastek Profit Jumps 11% Despite Revenue Dip; ₹8 Dividend Declared
Overview

Mastek announced Q3 results showing an 11.2% rise in profit to ₹108 crore, contrasting with a 3.7% revenue decline to ₹906 crore. The IT firm declared an interim dividend of ₹8 per share. CEO Umang Nahata attributed the revenue dip to furloughs and seasonal factors, while noting strong AI demand and a growing order backlog. Shares saw a minor gain pre-results.

Profit Surge Amid Revenue Headwinds

Mastek Ltd. reported a solid 11.2% quarter-on-quarter increase in net profit, reaching ₹108 crore for the quarter ended December 31. This positive earnings performance was achieved despite a 3.7% sequential dip in revenue, which settled at ₹906 crore compared to ₹940 crore in the prior quarter.

CEO Cites Near-Term Factors for Revenue Dip

Chief Executive Officer Umang Nahata attributed the revenue decline to several near-term factors. These included higher employee furloughs, planned project go-lives in key markets like the US and AMEA, and the planned deferral of certain engagements. Despite these challenges and seasonal softness, the company emphasized its execution with operational discipline and AI-led efficiencies.

Margin Expansion and Order Pipeline

The IT major's margins saw an expansion, moving to 14.1% from 13.6% in the preceding quarter. Earnings before interest and taxes (EBIT) remained steady at ₹128 crore. Mastek highlighted a sequential growth of 7.0% in its 12-month order backlog, indicating a robust pipeline across the UK, US, and AMEA regions. The company noted strong demand in the Healthcare segment and for AI-led solutions globally.

Dividend Payout and Market Reaction

Following the results, Mastek declared an interim dividend of ₹8 per share. The company has fixed January 30 as the record date for determining eligible shareholders, with payouts scheduled on or after February 17. Prior to the announcement, Mastek's shares closed marginally higher by 0.04% at ₹2,208.80 on the NSE, outperforming the benchmark Sensex which declined 1.38%.

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