TCS’s Jan-March quarterly net profit jumps 22%

Revenue for the period under review grew 23.9 per cent to Rs 16,430.1 crore compared to Rs 13,259.3 crore a year ago.

“We have delivered a year of strong growth with all markets and industry segments growing in double digits.

Pricing has been stable…We remain confident that the new fiscal will bring greater opportunities,” Chandrasekaran told reporters here this evening.

For the full fiscal (FY13),net profit jumped by 30.9 per cent to Rs 13,941.4 crore compared to Rs 10,651.7 crore in the previous fiscal.

Expressing confidence of beating apex industry body’s growth estimate for FY14,Chandrasekaran said deal pipeline remains strong for the company.

“Looking ahead,our deal pipeline is strong,we see a strong momentum. Deal closures are happening. We see traction both in ‘run the business’ as well as discretionary spend …This fiscal is going to be better than FY13. We will be ahead of Nasscom numbers in constant currency,” he said.

The company plans to add 45,000 staff in FY’14.

Full fiscal revenue jumped 28.8 per cent to Rs 62,989.5 crore from Rs 48,893.8 crore last year,Chandrasekaran said.

TCS does not offer guidance. Ahead of results,TCS shares fell by 1.73 per cent on BSE.

TCS numbers follows rival Infosys dismal earnings and muted guidance that had sent its shares on a tailspin. Infosys shares tanked 22 per cent last Friday after it said FY’14 revenue growth would be 6-10 per cent,way below industry estimate by Nasscom.

Third-ranked Wipro will announce earnings on Friday.

TCS announced a dividend of Rs 22 per share,including a proposed final dividend of Rs 13.

Gautam Sinha Roy of Motilal Oswal Securities said,”TCS net came in line with our expectations. So is the dollar revenue which just grew 3.1 per cent Q-o-Q,while volume grew just 4.4 per cent.”

Although TCS view for this fiscal is better than FY13 on the back of good deal pipeline and strong performance,Motilal Oswal Securities has a ‘neutral’ view on the counter,he said.

While Infosys continues to maintain a cautious outlook on the demand environment,TCS presented a bullish outlook.

“By and large,the environment presents a lot of opportunities for us because there is increasing adoption of technology because companies are looking at technology to transform themselves for growth,” Chandrasekaran said.

Infosys,which disappointed the market with its 3 per cent growth in net profit,gave a muted outlook of 6-10 per cent growth in revenue for FY2014 citing challenging global economy.

Smaller rival HCL Technologies earlier today posted a whopping 72.6 per cent jump in quarterly profit and 23.2 per cent growth in revenues in the January-March quarter.

On business targets,Chandrasekaran further said the company is pursuing more number of large deals,both in terms of number and size.

TCS said its business volume grew 4.4 per cent from the previous quarter,while operating margins fell to 26.5 per

cent from 27.7 per cent in the same quarter a year ago.

Revenues from North America grew by 27 per cent,while those from England rose by 44 per cent and Europe grew by 21

per cent,said TCS Chief Financial Officer Rajesh Gopinathan.

Among growth markets,Latin America grew by 40 per cent,Asia Pacific 27 per cent,India 16 per cent and Middle

East 28 per cent,he added.

The company’s infrastructure services grew 47 per cent,BPO business 46 per cent,while assurance services,enterprise solutions and global consulting grew 33 per cent,25 per cent and 52 per cent,respectively.

Gopinathan said the company spent Rs 2,600 crore in capex last year and expects it to be in the same range in FY14.

Ajoy Mukherjee,EVP and Head-Global Human Resources,TCS,said the company will give 100 per cent variable pay for the quarter.

“The wage hike (cycle) will also start from April onwards. This year will be averaging 7 per cent (hike) in the

country,so based on their performance,they see a wage hike of 5-10 per cent plus.”

Employees in developing countries will see wage hike in 4-6 per cent range,while for those posted in the developed

markets,it will be 2-4 per cent,Mukherjee said.

Asked if the company is still looking at acquisition opportunities in Europe,Chandrasekaran said TCS will look at both organic and inorganic routes for growth in the region.

“Europe is a focus area. We have been saying for sometime that we are looking at Germany and France. We are happy that we found the right company and we hope to complete the transaction by June with all the necessary approvals.”

TCS last week said it was acquiring French enterprise solutions provider Alti for 75 million euros (about Rs 533

crore) in an all-cash deal.

The revenues should start kicking in from Q2 onwards,the CEO added.

TCS,which added 52 new clients in Q4,is also looking at opportunities in Germany and Japan.

“We have endeavoured to maintain our profitability despite stiff headwinds and increased volatility through the year,” Gopinathan said.

As of March 31,2013,TCS has applied for 1,280 patents,192 of them in Q4. Till date,the company has been granted 81 patents.

Tata Consultancy’s quarterly profit up 13 percent

(AP) India’s top outsourcing company Tata Consultancy Services says quarterly profit rose 13 percent to $663 million as business from Europe emerged from a downturn.

CEO Natarajan Chandrasekaran said Wednesday that TCS added 52 new clients in the quarter and predicted stronger growth in fiscal 2014,which began in April.

Revenue for the quarter was up 14.8 percent to $3 billion. Profit for the fiscal year ended March rose 15.6 percent to $2.6 billion.

The quarterly and annual profits were in line with the average forecasts of analysts polled by FactSet.

The company’s stock was down 1.7 percent to 1,459 rupees ($26.91) in Wednesday trading ahead of the results,which were released after markets closed.