Consolidated profit before tax grew 4% quarter on quarter and 25.3% year on year to Rs 51.19 crore in Q1 FY22. EBITDA surged 12.4% quarter on quarter and 38.3% year on year to Rs 66.15 crore in Q1 FY22. Meanwhile, the IT company's EBITDA margin slipped to 26.1% in Q1 FY22 from 26.3% in Q4 FY21.

The company's profitability was impacted after it announced an exceptional loss of Rs 6.09 crore in Q1 FY22 on account of loss on fair valuation of warrant liability.

Venkatraman N, MD & CFO of Happiest Minds Technologies said, “We have begun the fiscal on a solid footing with good growth and performance. Our operations and delivery remain resilient in the face of supply side pressures and the pandemic situation. Our financials this quarter has an exceptional expense on account of fair valuation of warrant liability in our balance sheet. The original liability represented the probable future payout obligation basis growth and profitability of PGS Inc. Fair valuation of the original liability basis performance of the acquired asset, and changes, either debit or credit, must be routed through the P&L. Basis increasing probability of payout on account of performance, we have fair revalued the liability leading to an exceptional expense of ₹ 6.1 Crores. Our improving profitability means higher effective income-tax. Compared to the same quarter previous year wherein we had a significant tax credit by accounting for ‘deferred tax asset', this quarter we have a full charge or expenses in line with our profits.”

The company added 18 new customers in the quarter and total client based now stands at 180 as of 30 June 2021. The IT major's attrition rate (on TTM basis) stood at 14.7%.

Happiest Minds Technologies enables digital transformation for enterprises and technology providers by delivering seamless customer experiences, business efficiency and actionable insights.