Indian staffing firm TeamLease's Q1 profit misses estimates as costs bite

Teamlease Services

31/07/2024 11:56

BENGALURU, July 31 - India's TeamLease Services
 TLSV.NS  posted a smaller-than-expected quarterly profit on
Wednesday, hurt by higher expenses and weak demand in its
specialised IT staffing business.    
    The company, which hires and trains people before helping
them find jobs, said its consolidated net profit dropped 21.3%
to 207.9 million rupees ($2.48 million) year-on-year in the
three months ended June 30, below analysts' estimate of 241.7
million rupees, as per LSEG data.
    Expenses rose 19% to 25.74 billion rupees, hurt by salary
hikes and higher employee benefits costs.
    Revenue from its specialised IT staffing services business
climbed 3.6%, whereas that from its general staffing business
rose 20%.
    Staffing solutions providers have been impacted by companies
in the information technology sector slowing down hiring amid an
uncertain macroeconomic environment and tech clients cutting
spending on non-essential projects.
    Headwinds in the IT industry continue to impact the growth
in the company's specialized staffing business. While there has
been consistent growth in GCC clients, net headcount loss with
IT services clients was noted in the quarter, the company said
in an exchange filing.
    Total revenue for the company rose 18.8% to 25.80 billion
rupees.
    Teamlease's shares closed 1.02% higher ahead of results.
    
($1 = 83.6660 Indian rupees)

 (Reporting by Aleef Jahan in Bengaluru; Editing by Nivedita
Bhattacharjee)
 ((aleefjahan.cs@thomsonreuters.com;))