Tata Consultancy Services (TCS), India’s largest IT firm by market capilisation, posted 14.1 per cent year-on-year increase in its net profit to Rs 9,624 crore for the quarter ended in September. Sequentially the profit jumped from Rs 9,008 crore during the June quarter.
The consolidated net revenue also increased 16.8 per cent year-on-year to Rs 46,867 crore for the quarter under review. In constant currency terms its revenues rose 15.5 per cent year-on-year, the company mentioned. Commenting on the spectacular result, Rajesh Gopinathan, chief executive officer and Managing Director, said, “The strong and sustained demand environment is a once-in-a-decade opportunity to position ourselves as the preferred growth and transformation partner for our customers.
TCS board also approved a Rs 7 per share interim dividend for the shareholders of the company.
TCS said all verticals showed strong, double-digit year-on-year growth led by manufacturing vertical (up 21.7 per cent), followed by Life Sciences and Healthcare (up 19 per cent), Retail and CPG (up 18.4 per cent) and BFSI (up 17 per cent),communications & Media (up 15.6 per cent) and technology & services (up 14.8 per cent).
Geography-wise, the growth was led by North America (up 17.4 percent), UK (up 15.6 percent), and Continental Europe (up 13.5 per cent). Among emerging markets, growth was led by India (up 20.1 per cent), followed by Latin America (up 15.2 per cent), Middle East & Africa (up 13.8 per cent) and Asia Pacific ( up 7.6 per cent).
“We are using the growth tailwind to invest in strengthening relevant capabilities and building out a comprehensive portfolio of offerings that caters to a broader set of stakeholders in the enterprise across business cycles, strengthening our brand, and making our business more resilient. We believe this is the most sustainable pathway to create longer term value for all our stakeholders,” TCS CEO added.
The consolidated operating margin in the quarter under review stood at 25.6 per cent compared to 25.5 per cent in the previous quarter. “Strong growth and disciplined execution helped the company overcome headwinds from currency and supply-side inflation and deliver expanded margins," said Samir Seksaria, chief financial officer.
TCS has added five new clients in $100 million plus category, taking the total to 54 now. There was addition of 17 new clients in $50 million plus band where now it has 114 clients.
“Q2 saw strong demand for growth and transformation services as customers took a longer-term view of their businesses, driven by improving vaccination levels and business outlook. There was broad-based growth across services led by cloud, enterprise application services, analytics and IoT," the company added.
TCS attrition rate was at 11.9 per cent, the lowest in the sector, during September quarter. It added 19,690 employees during Q2FY22.
“Demand environment is expected to remain strong which bodes well for the company and the entire IT sector. Overall the company reported numbers which were below street estimates for the quarter and the markets will now look forward to the Infosys numbers which will be declared on the 13th of October," said Jyoti Roy, DVP, Equity Strategist, Angel One Ltd.