Despite a challenging Q1, Tech Mahindra CEO-designate Mohit Joshi is optimistic about medium- and long-term growth.

 Tech Mahindra CEO-designate Mohit Joshi

It will be difficult for Mohit Joshi to succeed given the difficult macroeconomic environment and Tech Mahindra's washout profits in the June quarter as he prepares to take over as CEO and MD. Despite the Q1 results, he is still sure that the IT services company will succeed in the medium to long term.

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Joshi will assume the top position when CP Gurnani, the company's current CEO and MD, retires on December 19. Joshi joined the firm as a senior board member as of just now, and during the previous 4-6 weeks, he and Gurnani have met with clients and staff members at Tech Mahindra's offices both domestically and abroad.

In his first earnings conference, Joshi said: "We have had a challenging set of results, but going forward, in the time I have spent with the company, I am confident about our medium and long-term growth. Gurnani called this quarter Tech Mahindra's "toughest quarter in the last five years." This will be predicated on the really solid and sturdy foundation that CP and I will seek to build upon as we manage the transition over the coming months.

"I am excited by the depth of the client connect since I got the chance to meet our clients all over the world and get an early idea of our service lines. In many cases, these are connections that transcend multiple continents. 

Numerous clients have mentioned how important a role we have played in their transformation process has been and will continue to play.

Tech Mahindra's performance in Q1FY24 was significantly impacted by the slowdown and drop in its single-largest industry, communications, entertainment, and media (CME), which generates close to 40% of the company's revenue due to seasonality in its Comviva business. CME had the worst performance, even though most other verticals also remained tepid to negative.

In order to acquire more business in Joshi's expertise areas of BFSI, healthcare, and other non-CME verticals, Gurnani said the company will also try to minimize the revenue weightage on CME under Joshi's direction.

However, that doesn't imply that the business would abandon the rising technological segments for which it has become well-known. Joshi stated, "I am also struck by the investments we have made in establishing and nurturing our service lines. Working closely with our ecosystem partners on technologies like artificial intelligence (AI), data analytics, etc., the service lines are genuinely cutting edge. This will continue as we move forward, I'm sure of it.

Joshi is a 22-year Infosys veteran with experience in the BFSI (banking, financial services, insurance) and healthcare sectors. As a member of Infosys' executive team in his prior position, he helped carry out the company's general transition during the preceding few years.

Industry observers claim that this will assist Tech Mahindra in broadening its deal-winning strategy and assist them in winning significant agreements, which often go to the top two or three firms like Tata Consultancy Services (TCS) and Infosys.

On July 26, Tech Mahindra released its Q1FY24 results. In Q1, net profit was Rs 692.5 crore, a 38 percent YoY decrease from the same quarter the prior fiscal year. Additionally, the net profit decreased sequentially by almost 38%.

The total revenue for the first quarter of FY24 was Rs 13,159 crore, up 3.5 percent YoY but down 4.1 percent QoQ.

CONTENT SOURCE - https://www.bqprime.com/business/in-mohit-joshi-tech-mahindra-gets-a-bankable-leader