Bangalore-based offshore services firm Mindtree kicked off its new FY with revenues on the rise but margins on the decline. Headline revenues for Q1 (to 30th June) grew by nearly 12% yoy to $117.7m, over 4% higher qoq. However, EBITDA margins lost 250bps yoy to 18.4%, 60bps down qoq.
Mindtree derives the vast majority of its revenues from application services, much like similar sized India-based peer Hexaware (see Profits rebound at Hexaware). However, although Mindtree grew faster Hexaware seems to have a better grip on profitability. The business mix is different, it must be said, and in any event, this level of performance gives Mindtree management nothing to be ashamed about under current market conditions.