BUSINESS

Highest-ever profit in Q3 at Rs 8,105 crore – TCS

Software firm Tata Consultancy Services on January 10 reported 2.6 percent sequential growth in December quarter profit at Rs 8,105 crore with constant currency revenue growth of 1.8 percent quarter-on-quarter (QoQ) meeting analyst expectations.

Tata Consultancy Services (TCS), the country’s largest software exporter, on Thursday reported a 24.1 per cent growth in year-on-year profit at Rs 8,105 crore for the quarter ended December 31, 2018, driven by strong gains from its banking, financial services and insurance business.

“The IT bellwether had posted a net profit of Rs 6,531 crore in the same quarter last year,” TCS said in a filing to the Bombay Stock Exchange.

Income from operations rose surged 20.80 per cent to Rs 37,338 crore in October-December quarter as compared to Rs 30.907 crore in the year ago period.

The directors of the company declared a third Interim dividend for the financial year of Rs 4 per share. The dividend will be paid on January 24, and January 18 has been fixed as the record date. 

Despite headwinds from the rupee volatility against various currencies, and higher cost of doing business in some major markets, the IT firm’s operating margins have been resilient. 

“We remain focused on driving rigour in our operations, generating strong cash flows and steering profit” , said TCS. 

Bonanza to investors:

The directors of the company declared a third Interim dividend for the financial year of Rs 4 per share. The dividend will be paid on January 24, and January 18 has been fixed as the record date.

BFSI leads the charge:

Revenue growth in BFSI stood out (+8.6% vs +6.1% in Q2). Growth was led by Energy Utilities (18.1%), Life Sciences & Healthcare (+15.7%), Communications & Media (+10.8%) and Retail & CPG (+10.5%).

UK operations star big: 

Revenue growth accelerated in all the geographies as against Q2. Growth was led by UK (25.1%), Europe (17.6%), and Asia Pacific (12.6%). North America grew 8.2%, India 9.7% and Latin America grew 7.6%. 

Consulting & services integration:

The IT major saw strong demand in areas like M&A, Global Shared Services and Enterprise Agility. TCS’ location independent Agile methodology is resulting in large Agile wins with marquee clients.

Digital transformation services: 

IoT, TCS Interactive and Cyber Security had an exceptionally strong quarter. IoT saw strong growth and deal wins around digital twin, fleet management and energy management solutions. TCS launched the Intelligent Power Plant solution this quarter. 

In a digital overdrive:

TCS Interactive saw significant off-take for digital content, digital channels and digital commerce services, led by opportunities around simplification and automation of MarTech stacks, seamless integration across the marketing ecosystem, and marketing analytics. Acquisition of W12 Studios and winning the Red Dot design award were the other key highlights. 

Cognitive business operations win it big:

The leading software firm saw strong growth powered by MFDMTM and cognitive services. TCS saw strong demand across M&A, digital infrastructure, cognitive business command center, enterprise business processes and and intelligent process automation.

Talent addition: 

Net addition in Q3 was 6,827 employees, bringing the total employee strength at the end of Q3 to 4,17,929 on a consolidated basis. TCS continued to have the best retention rate in the industry, with IT Services attrition rate (LTM) at 11.2 per cent. 

AUTHOR : RITESH RAI

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