TCS profit rises 8.38%, crosses Rs.10,000 cr in Q2

Tata Consultancy Services, (TCS) India’s largest IT company, has posted an 8.38 per cent rise in net profit at Rs 10,431 crore for the second quarter (Q2) ended September 2022 as against Rs 9,624 crore in the same period a year ago.

Total revenue for the quarter jumped 18 per cent to Rs 55,309 crore from Rs 46,867 crore. While constant currency revenue growth was at 15.4 per cent, order book was at $8.1 billion, TCS said.

Rajesh Gopinathan, MD and CEO, said: “Demand for our services continues to be very strong. We registered strong, profitable growth across all our industry verticals and in all our major markets. Our order book is holding up well, with a healthy mix of growth and transformation initiatives, cloud migration and outsourcing engagements.”

“As clients prepare for a more challenging environment ahead, technologies like cloud that have been embraced now have to be fully leveraged to realize the promised value. TCS has the combination of contextual knowledge, technology expertise and execution rigor to deliver on this imperative,” Gopinathan said.

Growth was led by retail and CPG (22.9 per cent), communications & media (18.7 per cent), and technology & services (15.9 per cent). Manufacturing as well as life sciences & healthcare verticals grew 14.5 per cent, while BFSI grew 13.1 per cent.

Among major markets, North America led with 17.6 per cent growth, continental Europe grew 14.1 per cent and the UK grew 14.8 per cent. In emerging markets, India grew 16.7 per cent, Latin America grew 19.0 per cent, Middle East & Africa grew 8.2 per cent and Asia Pacific grew 7.0 per cent, the company said.

“We are pleased that our office facilities are becoming once again the place of buzz with more and more of our employees and clients celebrating togetherness to realize their full potential,” said N Ganapathy Subramaniam, ED and COO.

Net profit: TCS net profit surpassed the analysts’ estimates and rose by 8 per cent to Rs 10,431 crore from the same quarter previous year, helped by continued strong demand. “Our order book is holding up well, with a healthy mix of growth and transformation initiatives, cloud migration and outsourcing engagements,” said Rajesh Gopinathan, Chief Executive Officer and Managing Director, TCS. He added that the clients are now embracing technologies like cloud, and TCS has ‘the combination of contextual knowledge, technology expertise and execution rigor to deliver on this imperative’.

Revenue: Tata Consultancy’s revenue rose by 18 per cent on-year to Rs 55,309 crore in three months to September. This was also higher than the Rs 54,881 crore consensus estimate of analysts tracked by Bloomberg. However, its operating margin contracted from 1.6 percentage points on-year to 24 per cent. Further, in terms of constant currency, TCS quarterly revenue grew 15.4 per cent on-year.

Dividend: TCS declared a second interim dividend of Rs 8 per share for its shareholders. The fiscal second quarter dividend is in addition to an interim dividend of Rs 8 per share announced in the previous quarter as well.

Markets & sectoral performance: In terms of markets, while North America was on the top of the charts with 17.6 per cent growth, UK grew 14.8 per cent and Europe grew 14.1 per cent. Among emerging markets, India registered 16.7 per cent growth, Latin America grew 19.0 per cent, Middle East Africa showed 8.2 per cent growth and Asia Pacific grew 7.0 per cent. In terms of sectoral performance, the filing showed broad-based growth across verticals, led by retail which showed 22.9 per cent growth and Communications & Media that grew 18.7 per cent. Other sectors like Technology & Services grew 15.9 per cent, Manufacturing as well as Life Sciences & Healthcare verticals grew 14.5 per cet, and BFSI grew 13.1 per cent.

Employees: With a total workforce strength of 616,171, TCS added a net of 9,840 employees during the quarter. The company’s women workforce is 35.7 per cent of the total strength. The attrition rate in IT services was 21.5 per cent on the last twelve months basis, but the company said it is now peaking. “We believe our quarterly annualized attrition has peaked in Q2 and should see it taper down from this point, while compensation expectations of experienced professionals moderate,” said Milind Lakkad, Chief HR Officer, TCS. In the second quarter, TCS employees registered 11.7 million learning hours, resulting in the acquisition of 1.5 million competencies.

With Thanks Reference to: finacialexpress(https://www.financialexpress.com/industry/five-highlights-from-tcs-q2-results-earnings-beat-street-interim-dividend-for-investors-all-round-growth/2706201/)

indianexpress(https://indianexpress.com/article/business/companies/tata-consultancy-services-net-up-revenue-jumps-8200818/)