Tech Mahindra Limited · NSE:TECHM

Tech Mahindra — Q4 FY22 Earnings Presentation

24 slides from Tech Mahindra's earnings presentation, May 2022

  1. Slide 1: Earnings Presentation Q4 FY22

    EARNINGS PRESENTATION Q4 FY22 May 2022 Copyright © 2020 Tech Mahindra. All rights reserved.

  2. Slide 2: FY22 Snapshot

    FY22 Snapshot $ 5,998 bn 12.4% $ 595 Mn Revenue PAT margin Free Cash flow 14.6% $ 3.3Bn EBIT Margin Net New Deal Wins 2 Copyright © 2020 Tech Mahindra. All rights reserved.

  3. Slide 3: Business Highlights FY22

    Business Highlights FY22 FINANCIAL OPERATIONAL SEGMENT GEOGRAPHY Revenue Headcount Communications Americas 17.3% 151,173 17.2% 18.6% (+30,119) IT LTM attrition Enterprise Europe EBIT % 40 bps 23.5% 17.4% 18.5% (up by 10 pp) PAT % Utilization (incl trainees) IT Services ROW 70 bps 85.5% 14.6% 14.1% (

  4. Slide 4: Q4'22 Snapshot

    Q4’22 Snapshot $ 1,608 mn 12.3% $ 111 Mn Revenue PAT Margin Free Cash flow 13.2% $ 1,011 Mn EBIT Margin Net New Deal Wins 4 Copyright © 2020 Tech Mahindra. All rights reserved.

  5. Slide 5: Business Highlights Q4

    Business Highlights Q4 FINANCIAL OPERATIONAL SEGMENT GEOGRAPHY Revenue Headcount CME Americas 4.9% 151,173 4.1% 3.6% (+6,106) IT LTM attrition Enterprise Europe EBIT % 160 bps 23.5% 5.4% 8.3% (no change) PAT % Utilization (incl trainees) IT Services ROW 30 bps 83.1% 5.1% 3.8% (down 90 bps) FCF to PA

  6. Slide 6: Management Commentary

    Management Commentary CP Gurnani CEO, Tech Mahindra Our improved growth performance reflects the power of Human-Centered experiences, a strong focus on innovation and our ability to create a strong customer and partner ecosystem. Tech Mahindra’s commitment towards sustainable digital transformation

  7. Slide 7: Business Update Q4FY22

    Business Update Q4FY22 ✓ Another quarter of deal wins over $1bn ✓ 5G led Transformation spends driving ✓ 5G leads growth for Communications growth in Telcos ✓ Digital Engineering, Cloud Migration, ✓ Technology & BFSI driving strong growth Cyber Security, Data Analytics key catalysts Strategy Custome

  8. Slide 8: Vertical Performance: FY22

    Vertical Performance: FY22 Banking, Communication, Retail, Financial VERTICALS Media & Manufacturing Technology Transport Others Services & Entertainment & Logistics Insurance % SHARE 40.4% 16.4% 15.8% 8.9% 7.9% 10.6% % Full-yr +17.2% +19.4% +12.3% +22.2% +19.2% +17.5% 8 Copyright © 2020 Tech Mahind

  9. Slide 9: Vertical Performance: Q4'22

    Vertical Performance: Q4’22 Communications, Banking, Financial Retail, Transport VERTICALS Media & Services & Manufacturing Technology Others & Logistics Entertainment Insurance % SHARE 40.6% 17.4% 14.9% 9.3% 7.6% 10.2% % QoQ +4.1% +18.5% -1.3% +15.1% -6.5% -1.7% % YoY +21.7% +28.2% +9.5% +32.4% +18

  10. Slide 10: Net New Deal Wins

    Net New Deal Wins Q4 Enterprise, 366 CME, 645 TCV: $ 1.0 Bn FY22 Enterprise, 1802 CME, 1478 TCV: $ 3.3 Bn Selected by an American Chosen by one of the Won a strategic deal for Won a deal for cloud media tech company for a world’s largest home building & operating application services with multi-year

  11. Slide 11: Strategic Highlights

    Strategic Highlights COLLABORATIONS OTHER HIGHLIGHTS Tech Mahindra, announced a collaboration with Yellow.ai, Tech Mahindra launches TechMVerse, to deliver to transform enterprise customer experiences with next- interactive and immersive experiences in the Metaverse gen conversational-AI solutions u

  12. Slide 12: People Updates

    People Updates Tech Mahindra was Tech Mahindra have been Quarterly annualized included in the 2022 proclaimed “Champion” in the attrition dropped for Bloomberg Gender- categories of ‘HR Technology’ the 2nd consecutive Equality Index (GEI), for and ‘Internal Communications’ at quarter the 3rd year in

  13. Slide 13: ESG Focus: Sustainability

    ESG Focus: Sustainability Awarded the 2022 ‘Industry Signed ‘The Climate Pledge’ One of only 2 companies to be Top-Rated’ and ‘Regional (by Amazon in association with awarded Gold class in S&P Top-Rated’ badges by ‘Global Optimism’) with a Sustainability Yearbook 2022 in commitment to achieve net- S

  14. Slide 14: ESG Focus: Social

    ESG Focus: Social Launched ‘Mind@Ease™’ - Building a Community of Rotary CSR Awards aggregator platform for Change Makers - In FY22, 2021 in the Community Counselling Services in Tech M associates Development category for association with TechM’s contributed to 32k hours of Exemplary Work with Maker

  15. Slide 15: Management Commentary

    Management Commentary Milind Kulkarni CFO, Tech Mahindra Our structural profitability continues to be robust, and we look forward to continuing our journey with commitment to resilient capital return and operational efficiency backed by a comprehensive digital portfolio 15 Copyright © 2020 Tech Mahi

  16. Slide 16: Financial Snapshot: FY22

    Financial Snapshot: FY22 REVENUE ($ Mn) GROSS PROFIT ($ Mn) EBIT ($ Mn) PAT ($ Mn) 5,998 1,836 872 746 5,111 1,621 729 598 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 DILUTED EPS (Rs) FCF ($ Mn) CASH & EQUIVALENTS ROCE % ($ Mn) 965 62.8 1,781 50.2 27.7% 595 1,141 24.1% FY21 FY22 FY21 FY22 FY21 FY22 FY21

  17. Slide 17: Operational Snapshot: FY22

    Operational Snapshot: FY22 HEADCOUNT UTILIZATION ATTRITION REVENUE MIX (including trainees) (Onsite) 85.3% 85.5% 23.5% 151,173 121,054 13.3% 63.2% 61.6% FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 ACTIVE CLIENTS TOP 10 CLIENTS 50 Mn+ CLIENTS DSO 1,224 92 97 1,007 31.3% 23 30.8% 21 FY21 FY22 FY21 FY22 FY

  18. Slide 18: Financial Snapshot: Q4'22

    Financial Snapshot: Q4’22 REVENUE ($ Mn) GROSS PROFIT ($ Mn) EBIT ($ Mn) PAT ($ Mn) 219 228 199 461 471 212 184 1,608 1,533 448 148 1,330 Q4'21 Q3'22 Q4'22 Q4'21 Q3'22 Q4'22 Q4'21 Q3'22 Q4'22 Q4'21 Q3'22 Q4'22 DILUTED EPS (Rs) FCF ($ Mn) CASH & EQUIVALENTS ROCE % ($ Mn) 17.0 15.5 1,781 1,346 28.8% 2

  19. Slide 19: Operational Snapshot: Q4'22

    Operational Snapshot: Q4’22 HEADCOUNT UTILIZATION IT ATTRITION REVENUE MIX (including trainees) (LTM) (Onsite) 151,173 145,067 62.8% 87% 61.1% 61.9% 24% 23.5% 84% 83% 121,054 13% Q4'21 Q3'22 Q4'22 Q4'21 Q3'22 Q4'22 Q4'21 Q3'22 Q4'22 Q4'21 Q3'22 Q4'22 ACTIVE CLIENTS TOP 10 CLIENTS 50 Mn+ CLIENTS DSO

  20. Slide 20: Other financial highlights

    Other financial highlights CASH CONVERSION TREASURY OTHERS ✓ Free cash flow at $ 111 Mn, ✓ Hedge book at $ 2,233 Mn ✓ Tax rate at 17.5% in Q4 FY22, conversion to PAT at 56.0% compared to $ 2,247 Mn in Q3 compared to 26.9% in Q3 FY22 FY22 ✓ DSO @97 days in Q4 FY22 compared to 101 days in Q3 FY22 ✓ US

  21. Slide 21: Capital Allocation

    Capital Allocation CAPITAL RETURN • Board Recommended Final Dividend of Rs 15/ Share and Special Dividend of Rs 15/ Share in addition to Special Dividend of Rs 15/ share declared earlier • Total Dividend for FY22, including (Final and Special) Dividend is Rs 45 / Share. • Total Payout Ratio for FY22

  22. Slide 22: Financial Summary: Q4'22

    Financial Summary: Q4’22 in $ Mn Q4'22 QoQ YoY Revenue 1,608 4.9% 21.0% EBIT 212 -7.3% -3.4% EBIT % 13.2% Other Income 42 41.5% 853.9% Miscellaneous + Interest Income 14 Exchange Gain/(Loss) 28 Profit Before Tax 247 -2.5% 17.2% Provision for tax 43 Profit After Tax 199 8.0% 34.4% PAT % 12.3% EPS (Ba

  23. Slide 23: Financial Summary: FY22

    Financial Summary: FY22 in $ Mn FY 22 YoY Revenue 5,998 17.3% EBIT 872 19.7% EBIT % 14.6% Other Income 149 41.9% Miscellaneous + Interest Income 74 Exchange Gain/(Loss) 76 Profit Before Tax 1,000 24.4% Provision for tax 245 Profit After Tax 747 24.9% PAT % 12.4% EPS (Basic) in Rs 63.32 EPS (Diluted)

  24. Slide 24: Copyright © 2020 Tech Mahindra. All rights reserved.

    Copyright © 2020 Tech Mahindra. All rights reserved.

Tech Mahindra — Q4 FY22 Earnings Presentation on 6ix