FILE PHOTO: Tata Consultancy Services (TCS) Chief Executive Officer Rajesh Gopinathan attends a news conference announcing the company’s quarterly results in Mumbai, India, January 10, 2019. REUTERS/Francis Mascarenhas/File Photo
| Photo Credit: FRANCIS MASCARENHAS
Tata Consultancy Services Ltd. (TCS) reported that its consolidated net profit for the quarter ended March 31, 2023 grew 14.8% year on year (YoY) to ₹11,393 crore. The company’s revenue during the quarter increased 16.9% to ₹59,162 crore. The growth was led by UK (+17%), Retail & CPG (+13%) and Life Sciences and Healthcare (+12.3%), the company said in a filing with the exchanges. While operating margin was 24.5%, net margin was 19.3% for the quarter. During the quarter, the company had a net addition of 821 employees. The company has reported an order book of $10 billion during the quarter.
For the full year, TCS reported 10% growth in net profit at ₹42,147 crore as compared to same period last year. Full-year revenue grew 17.6% to ₹225,458 crore. While operating margin was 24.1%, net margin was 18.7%. Growth was led by North America (+15.3%), UK (+15%), and India (+14.6%).
Rajesh Gopinathan, CEO, and MD said: “It is very satisfying to look back at our strong growth in FY 2023, on top of the mid-teen growth in the prior year. The strength of our order book demonstrates the resilience of demand for our services and gives us visibility for growth in the medium term.”
Mr. Gopinathan who had stepped down last month will be replaced by K Krithivasan from June 1, 2023.
“Krithi and I are working closely to ensure that the leadership transition over the next few months is smooth and seamless to all our stakeholders, and that TCS is well-positioned to capture the opportunities ahead,” Mr. Gopinathan said.
Urmi Shah, Research Analyst, SAMCO Securities said, “TCS reported a muted quarter, with a mixed bag of numbers. The company has not managed to sustain its margins though, and for FY23, we see a steep decline of 200 bps. Growth has been subdued for the quarter with the BFSI segment reporting single-digit growth and ending the year lower compared to the guidance.”
“However, the order book of $10 billion is at an all-time high, indicating optimism about growth in the IT sector. With the substantial decline in attrition rate, operational costs optimised and the order book remaining strong, it remains to see how FY24 paves out,” she said.
N Ganapathy Subramaniam, Chief Operating Officer and Executive Director, said, “During Q4 and through the year, we successfully delivered transformation programs of varying size and scale. Cloud and data continue to generate huge demand both internally from a talent perspective and externally from a solutions point of view.”
“We are embracing AI/ML holistically in our execution methods to leverage the huge data and metrics that we have on our delivery performance over decades, to generate insights and raise the bar on quality and experience to our clients,” he said.
Growth in Q4 was led by Retail and CPG (+13%) and Life Sciences and Healthcare (+12.3%). Other verticals grew in single digits. Technology & Services grew 9.2%, BFSI grew 9.1%, Manufacturing grew 9.1% and Communications & Media grew 5.3%.
Q4 growth was led by UK which grew 17%. North America which grew 9.6% and Continental Europe which grew 8.4%. Among emerging markets, Latin America grew 15.1%, India grew 13.4%, Middle East & Africa grew 11.3% and Asia Pacific grew 7.5%.
TCS’ workforce was at 614,795 as on March 31, 2023, a net addition of 22,600 for the year.
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