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TCS Q2 net up 8.5% to `10,465 cr on strong revenue growth
Tata Consultancy Services
India’s largest software exporter adds 9,840 employees in Sept qtr taking total headcount to 6.16 lakh; Already onboarded 35,000 freshers in H1 and will add 10,000 more in H2; Announced a dividend of Rs8 per share
Bengaluru: IT services major Tata Consultancy Services (TCS) reported a strong set of performance for the second quarter of FY23 with sound revenue growth along with improved operating margin.
The consolidated net profit of TCS was at Rs10,465 crore for the quarter ended September 2022, a growth of 8.41 percent over the same period of previous fiscal. The Mumbai-headquartered firm's revenue from operations grew by 18 percent Y-o-Y to Rs55,309 crore compared to Rs46,867 crore in the same quarter last year.
In dollar term, revenue was at $6.87 billion, which was a rise of 15.4 per cent in constant currency term over the same period of last year. In sequential term, revenue grew by 4 per cent in constant currency term.
"We have a satisfying quarter with strong growth coming across the verticals and geographies. Despite a challenging environment, demand for our services continues to be very strong. We have not seen any change in demand environment as of now. Our order book is holding up well, with a healthy mix of growth and transformation initiatives, cloud migration and outsourcing engagements," said Rajesh Gopinathan, CEO & MD of TCS.
"As a full-services player, we are seeing demand resilience as we remain relevant to the client in all kinds of environment," he added.
For the quarter ended September, operating margin of the IT major was at 24 per cent, a fall of 1 per cent year-on-year basis.
"We are steadily making our way towards achieving our operating margin priority for the year, aided by leverage from good growth, the flattening of the workforce pyramid, steadily improving productivity and currency support. Very importantly, the headwinds from the supply-side challenges are abating, so that sets us up well for the seasonally weak second half of the year," said Samir Seksaria, CFO of TCS.
For the quarter, deal momentum continued to remain strong with an aggregate win of $8.1 billion. "We see strong deal pipeline. Despite a challenging environment, we don't see any need for revising the outlook. Rather, we want to add more," said N Ganapathy Subramaniam, COO of TCS.
Among verticals, BFSI, retail and healthcare continued to perform well for the IT major.
During the quarter, TCS saw its attrition inching up to 21.5 per cent from 19.7 per cent in the previous quarter. "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 at TCS.
The company added 9,840 employees on net basis to take its employee count to 6.16 lakh by end of September quarter. On fresher hiring, he said that the company has already onboarded 35,000 freshers in the first half and would add around 10,000 more in the second half of this fiscal year. TCS also announced a dividend of Rs 8 per share as part its capital allocation policy.
