Tech Mahindra (TECHM) Q4 19/20 earnings summary

Executive summary

• FY20 revenue rose 6.1% YoY to ₹368,677 million ($5,181.9 million); owner-attributable PAT was ₹40,330 million ($566.8 million).

• Net new deal wins reached $3.71 billion vs. $1.67 billion in FY19; free cash flow was $523 million and conversion to PAT was 92%.

• COVID-19 disrupted Q4 operations, but remote working and business-continuity plans supported ongoing client delivery; over 90% of associates worked from home.

Financial highlights

• Consolidated revenue ₹368,677 million vs. ₹347,421 million; EBITDA ₹57,261 million vs. ₹63,369 million, with EBITDA margin at 15.5% vs. 18.2%.

• Consolidated profit after tax was ₹38,974 million vs. ₹42,888 million; owner-attributable PAT was ₹40,330 million vs. ₹42,976 million.

• Diluted EPS was ₹45.85 vs. ₹47.72; standalone revenue from services grew 7.3% to ₹292,254 million and standalone PAT was ₹45,345 million vs. ₹43,797 million.

• Consolidated operating cash flow was ₹43,581 million; cash and cash equivalents ended FY20 at ₹30,167 million vs. ₹20,427 million.

Outlook and guidance

• Strategy remains focused on Run Better, Change Faster and Grow Greater, with investments in cloud, 5G, AI, automation, cybersecurity and digital transformation.

• COVID-19 is expected to accelerate remote work, cloud migration, cybersecurity, automation and 5G demand; timing and scale of recovery remain uncertain.

• Net new deal wins and large transformation contracts support growth momentum, including the AT&T network-modernisation and cloud collaboration.