Tata Consultancy Services, India’s largest software services exporter, on Tuesday reported a 14.5 per cent rise in quarterly net profit at Rs 6,055 crore as against Rs 5,288 crore in the same period of last year, aided by a rise in new deals and execution on the ground.
The company clocked a 14.1 per cent rise in revenue at Rs 27,165 crore in the latest quarter as against Rs 23,816 crore in the same period of last year. On a quarter-on-quarter basis, revenue rose by 5.8 per cent and the net profit by 6.1 per cent. Infosys had reported a 9.8 per cent growth in quarterly net profit on Monday.
TCS said the revenue growth in constant currency was 3.9 per cent on a Q-o-Q basis and the volume growth was 4.9 per cent.
- HCL Tech Q3 net profit up 6 per cent to Rs 2,194 crore
- TCS third quarter net profit down 3.6 per cent
- TCS third quarter net profit down 3.6% to Rs 6,531 crore
- TCS Q2 net falls 2.1% YoY on softness in banking, retail
- TCS net profit up 12% on global biz growth
- TCS stock down over 4% on weak Q2 results
“We have delivered accelerated growth in constant currency terms for Q2. Driven by great execution on the ground, our broad-based performance has been led by strong sequential growth in BFS, retail and life sciences verticals with UK and North America leading the markets, said chief executive officer and managing director N Chandrasekaran. TCS shares rose by 0.19 per cent to Rs 2,597.40 on the BSE ahead of the results announcement.
“We remain focused on partnering with clients in multiple business dimensions to help them strategise and execute their digital roadmaps. Given the growing market adoption of digital, we continue to take new IP-led products and platforms to market successfully as well as invest in training our talent. Over 30,000 TCSers have already successfully trained in new technologies this year using our experiential digital learning platform,” he said.
Rajesh Gopinathan, chief financial officer, said: “In a dynamic external environment, we continue to manage our operations with discipline and agility to ensure that we can support business growth. Our focus on profitability have increased our margins sequentially and generated strong cash flows while investing for future growth.”
TCS growth was broad-based in the second quarter with all industries growing on a sequential basis led by BFS, retail, life sciences and travel & hospitality. “Core markets like UK, North America and Europe grew smartly along with emerging markets like Latin America, India and MEA. There was balanced growth across service lines led by Asset Leveraged Solutions,” Chandrasekaran said.
The company continued to hire to support business growth. There was a total gross addition of 25,186 people (net addition of 10,685 employees) taking the total employee strength of 3,35,620 employees on a consolidated basis. The utilisation rate (excluding trainees) was at 86 per cent and that including trainees was 82.3 per cent.
The attrition rate (LTM) was at 16.2 per cent including BPS. “On a quarterly basis, our retention levels have improved this quarter with a net addition of over 10,000 employees in Q2. Our hiring continues to be strong with all time-high of over 25,000 employees joining us this quarter,” said Ajoy Mukherjee, executive VP and global head, human resources.
Sarabjit Kour Nangra, Vice President, Angel Broking, said, “TCS posted results below expectations on the sales front and net profit, while the EBIT margins remained in line with expectations.”