Happiest Minds reports Rs 58 Cr net profit for Q4 of FY23

Happiest Minds posts 11% rise in net profit for Q4

Happiest Minds Technologies, the Bengaluru-headquartered IT services company has reported a net profit of Rs 57.66 crore, a year-on-year (YoY) growth of 10.7%, for the fourth quarter of FY23. The revenue increased by 24.5% to Rs 386.43 crore.

The company for FY23 reported a net profit of Rs 231 crore, growing by 27.5%, and revenue rose by 28.3% to Rs 1,450.40 crore registering while the EBITDA margin stood at 26.2%. Happiest Minds has declared a final dividend of Rs 3.4 per share.

Happiest Minds added 16 clients during the fourth quarter and took the total number to 237 for FY23. The headcount at the end of the last financial year was 4,917 with a net addition of 306 during the fourth quarter.

Ashok Soota, Executive Chairman, Happiest Minds said, “In view of our strong business pipeline, we are planning a record people addition of 1,300. Accordingly, we are retaining our FY24 revenue guidance growth at 25%.”

Deal activity in technology services to remain cautious

The deal activity in the technology services industry is likely to enter into a cautious zone given the uncertain economic environment, according to a report done by EY and NASSCOM.

The report titled “A Year of Paradoxes: M&A Trends and Outlook in the Technology Services Sector" noted that with greater emphasis on emerging digital capabilities, the market is likely to become more cautious and adopt creative deal structures to manage risk. Although deal activity has softened, with 150+ deals announced in Q1 CY23 compared to 270+ in Q1 CY22 and 220+ in Q1 CY21, deal activity for mid-sized companies is expected to remain strong across the broader M&A market. Select segments of strategic buyers and PE roll-ups are expected to continue driving deal momentum.

At the same time, the technology service sector proved to be a year of paradoxes. Despite signs of a slowdown at the end of the year and into Q1 CY23, the technology service sector still witnessed a surge in M&A and private equity deals, reaching a total of $57 billion-plus more than double the amount seen in 2020 ($27 billion-plus).

In 2022, the technology service sector including IT Services, BPM, and ER&D saw an uptick in transaction activity, with a total of 947 deals—the highest number recorded in the past five years. The total deal value and volume in 2022 doubled from the levels seen in 2020, though deal value remained relatively steady throughout 2021 and 2022. (excluding two $10 billion-plus deals in 2021).