Shares of TeamLease Services fell 3% on May 18 after reporting disappointing fourth-quarter results. The human resources firm reported a 23% drop in net profit to Rs 24 crore from Rs 32 crore a year earlier. PAT (Profit After Tax) for December 2022 quarter is Rs 29 crore.

The company’s operating income rose 12% year-on-year, while it edged up 2% quarter-on-quarter to Rs 2,027 crore. EBITDA fell 18% year-on-year to Rs 34 crore from Rs 41 crore in the corresponding period of the previous financial year. It was Rs 32 crore in Q3FY22. EBITDA margin contracted to 1.7% from the 2.3% reported in Q4FY22.

“The general staffing business has grown uniformly across verticals and the outlook for the next few quarters is positive. As external variables impact the higher margin business of professional staffing and DA, the outlook for the next few quarters is positive,” said Ashok Reddy, Managing Director, TeamLease Services.

The company recorded a net increase of 8,000 headcount in the general staffing sector in Q4FY23, while a decrease of 9,000 headcount in Degree Apprenticeships (DA) due to the termination of the NEEM (National Employability Enhancement Mission) scheme. Professional headcount was also down by 600 during the quarter due to headwinds in the IT sector. The company mentioned that they have taken cost containment measures in staffing and DA departments.

The company’s market value has fallen more than 34% in the last year and about 12% in the past six months. The stock was trading 2.9% lower at 10:11 am on the National Stock Exchange, with the benchmark Nifty trading 0.20% higher at 18,218.60.