In an interview with CNBC-TV18, managing director Arun Jain said high inflation in the European market had hit the company slowing down decision-making
Shares of Intellect Design Arena cracked in early trade on October 31 hitting a 52 week low after a weak September quarter saw the firm’s margin contract 10 percent.
The company posted net profit of Rs 45.767 crore for the period in review as against Rs 68.77 crore a quarter ago.
In an interview with CNBC-TV18, managing director Arun Jain said high inflation in the European market had hit the company slowing down decision-making.
But he clinged on to the margin guidance of 20 percent for the financial year.
“The pipeline is very healthy, $ 800 million, but closures are taking longer because of uncertainty in the Russia-Ukraine war and high inflation rates,” said Jain.
At 1:30 pm, the company’s share traded at Rs 440.75 on the NSE.
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The managing director added that travel, talent, and tax also affected profit margin.
“Three ‘Ts’ are impacting our PAT (profit after tax) margins. One is travel, which was not there last year, talent, and tax. However, travel has stabilised in the two quarters. So, there will not be incremental travel costs. Still, year-to-year, there is a substantial increase in travel costs, which is impacting the margin, and tax costs of 26 percent are significantly larger than 16 percent last year,” said Jain.
The company also reported a fall in total income as it came in at Rs 538.434 crores for the period under review as compared to Rs 551.056 crore a quarter ago.
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