Mphasis Limited — Interim / Quarterly Report 2021

Jan 22, 2021

DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

22 January 2021

The Manager, Listing The Manager, Listing BSE Limited National Stock Exchange of India Ltd Phiroze Jeejeebhoy Towers, Exchange Plaza, Plot No. c/1, Dalal Street, G-Block, Bandra-Kurla Complex, MUMBAI - 400 001 MUMBAI – 400 051

Dear Sirs,

Sub: Presentation for Investor(s)/Analyst(s) call

Please find enclosed a copy of the presentation proposed to be made at the Investor/ Analyst call to be held today at 9:00 am (IST) in connection with the results of the Company for the quarter ended 31 December 2020.

The presentation is also being hosted on the website of the Company at www.mphasis.com.

We request you to kindly take the above on record as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Yours faithfully,

For Mphasis Limited

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Subramanian Narayan Vice President and Company Secretary

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Encl: As above

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Mphasis Q3 FY 2021

Earnings Presentation

22[nd] January 2021

Nitin Rakesh

Chief Executive Officer And Executive Director

Manish Dugar Chief Financial Officer

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Safe Harbor

Certain statements mentioned in this our are presentation concerning future growth prospects forward looking statements (the “Forward Statements”) and are based on reasonable expectations of the management, which involves a number of risks, and uncertainties that could cause actual results to differ materially from those in such Forward Statements. The risks and uncertainties relating to these Forward Statements include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, fluctuations in foreign exchange rates, revenue and profits, our ability to generate and manage growth, intense competition in IT services, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price and fixedtime frame contracts, restrictions on immigration, industry segment concentration, our ability to manage our international operations, our revenues being highly dependent on clients in the United States of America, reduced demand for technology in our key focus areas, disruptions in telecommunication networks or system failures, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, withdrawal of fiscal governmental incentives, political instability, adverse impact of global pandemics (including COVID-19 impact), war, legal restrictions on raising capital or acquiring companies, unauthorized use of our intellectual property(ies) and general economic conditions affecting our businesses and industry. We may, from time to time, make additional written and oral Forward Statements . We do not undertake to update any Forward Statements that may be made from time to time by us or on our behalf, unless required under the law.

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Top Ten Strategic Predictions for 2021 and Beyond

By 2025, traditional computing technologies will hit a digital wall forcing the shift to new computing paradigms

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Source: https://www.gartner.com/smarterwithgartner/gartner-top-10-strategic-predictions-for-2021-and-beyond/

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58 Creating higher-value, larger, integrated deals

GTM Deal Archetypes

Zero Cost Transformation

1 Channeling run cost optimization to power modernization and transformation

Platform driven Enterprise Modernization

2 Helping enterprises compete with digital native firms by transforming them into a platform enterprise

Service Transformation

3

Accelerating value delivery from investments through capital release. Prepping for slowdown

Mphasis Tribes Leveraged

Modernization | Next Gen IT Ops | DevOps | Data

XAAP | DevOps | Modernization |Data

Next Gen IT Ops | Data

Larger Deals

Engaging in >$25 Mn Pursuits consistently

Upstream

High % of Proactive Pursuits

Operations Transformation

4 Infusing Cognitive and Digital levers to deliver next gen business process transformation : Tech Ops

Data Driven DevOps

5

Helping enterprises shift left using devops framework. Leveraging Stelligent capabilities

Next Gen Ops | Data

DevOps | Data

Strategic access

CEO COO CIO

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Our Tribe led Pipeline has increased over the past year

Tribes-led increased inflow of pipeline and Large deal wins

D I Modernizat Dev Automat Cyber Secu Next Gen App D A	678.4 10.9% 17.9% 13.6% 6.4% 6.7% 10.8% 16.2% ata MS ion ops ion rity ev MS 6.2% Experience(New Tribe) 15.4% 8.7% 19.5% 4.9% 20.3% DevOps 21.1% 4.0% Next Gen IT Ops(IMS+AMS) Data Modernization Cyber Security Next Ops XaaP 49%	678.4 10.9% 17.9% 13.6% 6.4% 6.7% 10.8% 16.2% ata MS ion ops ion rity ev MS 6.2% Experience(New Tribe) 15.4% 8.7% 19.5% 4.9% 20.3% DevOps 21.1% 4.0% Next Gen IT Ops(IMS+AMS) Data Modernization Cyber Security Next Ops XaaP 49%
	Dec-19	Dec-20

• The Specialty division of Ardonagh Group, UK's largest independent insurance broker has signed up Mphasis for a Digital Transformation engagement

• A F500 Global Consulting Professional Services firm, specializing in Risk and Insurance Services, chose Mphasis to modernize their complex legacy platform in one of their divisions in a multi year engagement

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Direct Business has been Consistently Delivering Strong Growth

Accelerated Growth in Direct Revenue

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$1Bn+ revenue for Direct on LTM basis
CAGR
283
+19.7%
268
241 240
236
Q3’20 Q4’20 Q1’21 Q2’21 Q3’21
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Revenue in $M at average USD/INR rate for the respective quarters

Top Accounts leading growth in Direct

LTM revenue ($ Mn) for top 10 accounts in Direct ( as per MDA disclosures)

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YoY YoY
+18%
22.1%
40%
21.4%
18.9%
18.9%
Top 6 - 10 18.6%
81.1% 81.1% 78.6% 77.9%
Top 1 - 5 81.4% 13%
Q3’20 Q4’20 Q1’21 Q2’21 Q3’21
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Overall
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Top 10
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Europe
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NCA
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Strong QoQ (5.3% CC) and YoY (19% CC) growth; Broad based growth across all units

Top 10 accounts in Direct continue to deliver above industry growth; YoY growth of 18%[*]

Europe region delivering strong growth; FYTD revenue has grown at ~23% YoY on CC basis

NCA continues to contribute to growth in Direct; has grown at a CAGR of ~60% in last 3 years

Note: Direct revenue for all periods restated to include direct business moved from erstwhile DXC/HP business into Direct effective Q1’21

* On LTM revenue

NCA: New Client acquisitions

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Growth has been broad based growth across verticals

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Q3’21 Direct Direct
US$ M Revenue by Segment Q-o-Q Q-o-Q Y-o-Y
145 178 2% 2% 30%
124
120
BCM
36
34 32 4% 7% -1%
Insurance 32 50
48 43 11% 57% 67%
ITCE 36
33 44 42 5% 8% -1%
Logistics & Transportation 27
Others 36 44 43 38 -10% -4% 3%
Q3’18 Q3’19 Q3’20 Q3’21
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• BCM: Consistent track record of double-digit YoY growth

• Consecutive quarter of 20%+ YoY growth; “Best in class performance”

• Insurance: QoQ overall growth of 4.0%

• Expect to continue the growth momentum in the coming quarters considering the recent large deal wins

• ITCE : Strong growth driven by recent large deal wins

• Direct business Europe revenue grew 13.5% QoQ and 20.5% YoY in CC

• * Revenue in USD $M at average USD/INR rate for the respective quarters

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Hyper-growth Sub-Vertical: Hi-Tech

Direct Hi-Tech Revenue

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$ MM
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86
CAGR
+47%
51
40
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• Our domain-centric Product Engineering Services Expertise has helped us in becoming a strategic, innovative and reliable partner to enterprises across industries- Compute Systems, Enterprise Software, Medical Devices, Consumer Tech & Industrial Engineering

• At our key accounts, Mphasis is recognized as Technical Leader and Strategic Partner for the next generation product engineering work and digital enablement

Annualized Q3FY19 Annualized Q3FY20 Annualized Q3FY21

Consistent Revenue Growth, Strong NCA Channel, Key Breakthroughs in Alignment with Our Strategy

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Strong deal win momentum in Direct

Direct TCV Wins^

Direct: Revenue vs TCV – Strong Correlation

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YoY CAGR
+22%
+25%
247
197
138 174
110
164
New Gen 108
84
73
Traditional
30 26 33
Q3’18 Q3’19 Q3’20 Q3’21
^ TCV wins : $ Mn
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• Q3’21 Direct TCV wins of $247M

• 71% of Q3’21 deal wins came from New-Gen areas

• US$ 1,075M TCV (TTM), up 59% Y/Y vs prior period

• Fourth consecutive quarter of $200M TCV wins

• FYTD TCV wins of $867M; YoY growth of 64%; 74% of FYTD deal wins came from New-Gen areas

• Our New Gen wins are witnessing increased deal sizes

Note: Direct TCV for all periods restated to include direct business moved from erstwhile DXC/HP business into Direct effective Q1’21

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Direct: Progression in Client Mining and Large-deal Metrics

Client Pyramid

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81
• Continuous improvement in client 77
60
pyramid driven by expansion of wallet 35
share in large clients and consistent new
client wins
• 30
Healthy conversion of clients at each
stage to the next (50% conversion rate)
26
15 [16]
13
Q3’18
Q3’20
9
Q3’21 7 7
5 5
4 4
3
2 2
1 1
>$100 M >$75 M >$50 M >$20 M >$10 M >$5 M >$1 M
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Note: All metrics based on last twelve months of revenue; Excludes DXC

Focus on winning large-deals (>$20M TCV)

# of cumulative deal wins since Q1’18

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LTM avg deal size 28 31 67
(large deals)
24
22
21
19
16
13
11
10
9 9
7
5
4
3
2
Q1’ Q2’ Q3’ Q4’ Q1’ Q2’ Q3’ Q4’ Q1’ Q2’ Q3’ Q4’ Q1’ Q2’ Q3’
18 18 18 18 19 19 19 19 20 20 20 20 21 21 21
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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Strong Operating Performance driving EPS Growth and Cash generation

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Revenue growth Operating Profit growth
967 155
CAGR +10.1% CAGR +12.8%
920 147
133
827
725 108
9M FY’18 9M FY’19 9M FY’20 9M FY’21 9M FY’18 9M FY’19 9M FY’20 9M FY’21
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Gross Revenue in $M at average USD/INR rate for respective periods

EBIT in $M at average USD/INR rate for respective periods

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EPS growth Free Cash flow growth
CAGR +16.6% 48.2 CAGR +14.7%
132
44.6
41.8 120 120
30.5 88
9M FY’18 9M FY’19 9M FY’20 9M FY’21 9M FY’18 9M FY’19 9M FY’20 9M FY’21
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Basic EPS in INR for respective periods

FCF: Cash flow operations less capex; converted at average USD/INR for respective periods

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

Summary

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1. Revenue growth helped by sustained performance in Direct (CC growth of 19% Y/Y in Dec-20, 16.2% YTDFY21)

• Growth supported by robust TCV win trend (+64% FYTD)

2 KPIs moving in the right direction

• Track record in winning large deals consistently improving marked by increasing-sized and longer-tenure deals during FY21 (US$50 mn → US$100 mn → US$200 mn);

• Growth getting broad-based while continuing to drive market share gains with key clients;

• Client mining metrics across revenue buckets is improving;

• Accelerated growth in Europe as we expand our presence here

• 3 Building visibility in DXC beyond September21

• 4 Using operating leverage to feed growth – operating in our target operating margin band of 15.5-16.5% allows us to keep investing in the business

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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Q&A
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DocuSign Envelope ID: FBBC5099-677E-4A09-9ED2-978B04838E58

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Transformation in Times of Crisis

Eight Principles to Create Opportunities and Value in the Post-Pandemic World

• Challenge your Mental Models and Always Stay Ahead

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•
•
•
•
•
•
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• Reimagine and Reinvent Your Approach to Customers and Stakeholders

• Speed up Digital Transformation and Design for Personalization at Scale

• Reinvent Your Talent Strategy and Embrace Open Innovation and Open Talent

• Seize the Need for Speed and Design for Agility, Adjacencies and Adaptability

• Innovate then Experiment, Experiment, Experiment

• Redraw Your Timelines and Build a Portfolio of Initiatives across all Innovation Horizons

https://www.transformationintimesofcrisis.com/

• Deploy Idealized Design, Recreate Your Organizational Architecture and Network Orchestration

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