Tata Communications has registered a 30 per cent decline in standalone revenues at Rs. 759 crores compared to Rs.992 crores in the same quarter last year. The bottom line also took a serious hit and came in lower by 68 per cent at Rs 10.45 Crs against Rs 33 Crs.
The major reason for decline in revenues was lesser demand for wholesale voice services in telecommunication services segment which contributed only Rs 300 crore in this quarter compared to Rs 461 Crores contribution in corresponding quarter.
The enterprise and corporate data segment contributed Rs. 300 Crores to the revenues whereas other services contributed Rs. 159 Crores.
Tata Communications was formed by merger of VSNL, its international subsidiaries. They seem to be focusing on servicing enterprise clients. The main cause of worry for TATACOM is the entry of telcos in the enterprise segment to derive higher margins and volume.
Mindtree Q2 results:
MindTree has reported 34 per cent growth in the bottom line at Rs 49.88 crore compared to Rs 37.27 Crores last year. The revenues were slightly up by 1 per cent at Rs 314.98 Crores.
The company seems to have done exceptionally well in terms of net profits but stagnant revenues signals that the recovery for mid-IT companies will be slow and steady.
MindTree has also recommended an interim dividend of 10 per cent for half year ended September 2009.
According to Mr Krishnakumar Natarajan, CEO and Managing Director, MindTree,“We are seeing a slow but steady improvement in the global economic situation and this is reflected in our financial performance in the recent quarter. We added 24 customers, across our businesses and geographies,” he added.
The company also seems gung ho about its recent acquisition of Kyocera Wireless India and is confident of achieving $ 1 billion topline by 2014. Although it needs to be seen if margins in mobile product business will be anything to write about as recent competition for low cost mobiles has already seen a severe erosion in margins.The company at the same time may also face flake from investors as diversifying in hardware business may not find enough takers and also raise finger on growth prospects of IT division.
