Earnings Snapshot: Tech Mahindra, ICICI Lombard, Persistent Systems, and IREDA

TECHM₹1,462.20 -0.40%

Revenue ₹13,995 crores 🔼 5%

PAT ₹1,202 crores🔻 5%

Tech Mahindra Ltd. had a quarter defined by strong deal momentum and significant margin improvements, despite challenges in headcount. The company’s focus on next-generation technologies clearly worked well, as evidenced by new deal wins hitting $816 million, which is a high figure suggesting strong revenue visibility. 

Even though the net profit fell 5% compared to Q2 of last year, it showed a sequential improvement of 6% from the previous quarter, Q4FY25. 

The success was heavily concentrated in AI-native operations and GenAI, securing deals for major European banks, telecom operators, and an e-commerce technology leader. This focus is reinforced by the launch of their next-gen AI platform, TechM Orion, and recognition in the prestigious Indian AI Mission.

The company achieved its eighth consecutive period of margin expansion, demonstrating disciplined control over operational costs. However, the company faced two key challenges: Revenue growth was slow, with the USD revenue essentially flat year-on-year. Furthermore, the IT headcount decreased by 1,459 sequentially and 2,090 year-on-year, showing a shrinkage in the workforce despite the strong deal wins, and the LTM attrition rate slightly increased. 

The Board has approved a dividend of ₹15 per share.

ICICIGI₹2,005.00 +8.10%

Gross Direct Premium Income (GDPI) ₹6,596 crores 🔻 2%

PAT ₹820 crores 🔼 18%

ICICI Lombard General Insurance Company Ltd. saw significant growth in its profit after tax for both the quarter and half-year. The Solvency ratio was strong at 2.73x, well above the regulatory requirement, indicating a very robust financial foundation.

The main area where the company struggled was in core business growth relative to the industry and maintaining claims efficiency. Gross Direct Premium Income (GDPI) showed a slight de-growth under the new accounting rules. Even when adjusting for the new rule, the company’s GDPI growth lagged significantly behind the industry average across both the half-year and quarter. 

Furthermore, the Combined Ratio increased (meaning claims and expenses consumed a larger portion of premium income), indicating a slight deterioration in core underwriting efficiency.

The Board of Directors has declared an interim dividend of ₹6.50 per share.

PERSISTENT₹5,669.60 +6.21%

Revenue ₹3,580 crores 🔼 24%

PAT ₹471 crores 🔼 45%

Persistent Systems Ltd. reported its 22nd consecutive quarter of revenue growth, highlighting consistent performance and execution excellence. A key success was the significant improvement in profitability, with the operating margin improving to 16.3%. This growth was broad-based and supported by substantial new business: the order booking for the quarter was strong at $609.2 million in Total Contract Value (TCV) and $447.9 million in Annual Contract Value (ACV). 

Persistent secured key client wins across all major verticals: Software and Hi-Tech saw deals to scale AI infrastructure platforms and drive R&D for cybersecurity products; Banking, Financial Services & Insurance (BFSI) included projects to leverage GenAI to reimagine business operations and enhance customer experience; and Healthcare & Life Sciences won deals for digital presence modernization and application consolidation.

IREDA₹156.90 +1.54%

Revenue ₹4,005 crores 🔼 28%

PAT ₹796 crores 🔼 3%

Indian Renewable Energy Development Agency Ltd. achieved a massive 86% growth in Loan Sanctions and a 54% rise in Loan Disbursements year-on-year, underscoring aggressive funding support for the renewable energy sector. This lending activity resulted in the Outstanding Loan Book growing by 31%. The Loan Book remains well-diversified geographically, with a Pan-India presence across 23 states and four UTs, and key states like Rajasthan, Karnataka, and Andhra Pradesh holding large shares.

The company effectively worked to diversify its lending portfolio towards both traditional and emerging green technologies. While Solar Thermal/SPV remains the largest sector at 24% of the loan book, Wind financing saw a proportional decline from 16% to 12%. Conversely, the company increased its focus on higher-growth segments like Ethanol, Manufacturing, and Hybrid Wind & Solar, which all saw increased proportional representation. Furthermore, the company successfully lowered its cost of funds by securing favorable domestic and foreign borrowings, such as raising JPY 26 Billion from SBI Tokyo.

Although the company’s lending profile is robust and its borrowing profile is secured by AAA credit ratings, a deterioration in asset quality indicates that the pace of loan growth has introduced higher credit risk compared to the previous year.

Note: The stock prices mentioned are as of 1:30 pm.