Tata Consultancy Services (TCS), India’s largest IT company, posted a 5.2 per cent growth in net profit in the June quarter of FY23 at Rs 9,478 crore as compared to Rs 9,008 crore in the same period of last year.
However, on a quarter-on-quarter basis, net profit fell by 4.5 per cent from Rs 9,926 crore in the March quarter as TCS was hit by increased costs across. The company also declared a dividend of Rs 8 per share.
“We are starting the new fiscal year on a strong note, with all-round growth and strong deal wins across all our segments. Pipeline velocity and deal closures continue to be strong, but we remain vigilant given the macro-level uncertainties,” said CEO & MD Rajesh Gopinathan.
He said the new organisation structure has settled in nicely, getting the company closer to its clients and making it nimbler in a dynamic environment, adding, “Looking ahead, we remain confident in the resilience of technology spending and the secular tailwinds driving our growth.”
Among major markets, North America led with a 19.1 per cent growth, continental Europe grew 12.1 per cent and the UK by 12.6 per cent. In emerging markets, India grew 20.8 per cent, Asia Pacific by 6.2 per cent, Latin America 21.6 by per cent and Middle East & Africa expanded by 3.2 per cent.
“The investments we made on people, upskilling efforts and select lateral hiring et al helped manage the talent turnover with minimum impact on our operations. During the quarter, we have resumed in-person meetings, and hosted several clients at our facilities,” said chief operating officer and executive director N Ganapathy Subramaniam.
TCS’ workforce stood at 6,06,331 as on June 30, a net addition of 14,136 during the quarter. “The workforce continues to be very diverse, comprising 153 nationalities and with women making up 35.5 per cent of the base,” the company said.
According to Samir Seksaria, chief financial officer, it has been a challenging quarter from a cost management perspective. “Our Q1 operating margin of 23.1 per cent reflects the impact of our annual salary increase, the elevated cost of managing the talent churn and gradually normalising travel expenses. However, our longer-term cost structures and relative competitiveness remain unchanged, and position us well to continue on our profitable growth trajectory,” he said.