Tech Mahindra Plunges Over 10 Percent On BSE After Q1 Revenue Warning

29/06/2015 3:39 PM IST | Updated 15/07/2016 8:25 AM IST
NOAH SEELAM via Getty Images
Chairman of Tech Mahindra, Anand Mahindra listens to a question during a press conference in Hyderabad on April 20, 2009. India's Tech Mahindra has won the bid for Satyam Computers Sevices in a sale aimed at giving the scandal-hit outsourcing giant vital fresh capital and a new begining. AFP PHOTO / Noah SEELAM (Photo credit should read NOAH SEELAM/AFP/Getty Images)

Shares of IT firm Tech Mahindra on Monday fell sharply by 10.5 per cent to hit a one-year low after the company warned of weak revenue and earnings in the April-June quarter due to higher visa costs and other headwinds.

Following the news, the stock tumbled 10.44 per cent to Rs 467.40, its 52-week low at the Bombay Stock Exchange on a day when the stock market was hit by worries of Greece's possible exit from the eurozone.

READ: Sensex, Nifty Plunge Over 2 Percent, After Greece Rescue Talks Collapse

“Q1 FY16 has some headwinds and tailwinds, which could see a risk of marginal decline in both revenue and EBITDA margin on a sequential basis,” the company said in a regulatory filing.

In addition, seasonally weak mobility business will be a drag on revenue in the period. And on top of that, the company will be spending more on H1B visas for its employees, which translates into lower margins.

The only good news is that the company expects currency movements to be in its favour, and that might help shore up revenue.

(With agency inputs)

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