Tata Consultancy Services (TCS) on Wednesday reported a 14.8 per cent jump YoY in its net profit to Rs 11,436 crore for the quarter ended March 2023 (Q4 FY23). The revenue from operations of India’s largest IT services company also rose 16.94 per cent to Rs 59,162 crore, compared with Rs 50,591 crore in the year-ago period.
TCS’ net profit had stood at Rs 9,959 crore in the corresponding period last year (Q4 FY22).
On a sequential basis, TCS’ net profit increased 5.08 per cent as compared with Rs 10,883 crore in the previous quarter ended December 2022. Its revenue also rose 1.6 per cent, as against Rs 58,229 crore in the quarter ended December 2022.
The company’s board also recommended a final dividend of Rs 24 per equity share of Rs 1 each.
“We would like to inform you that at the Board Meeting held today, the Directors have recommended a Final Dividend of Rs 24 per Equity Share of Rs 1 each of the Company which shall be paid/dispatched on the fourth day from the conclusion of the 28th Annual General Meeting, subject to approval of the shareholders of the Company,” TCS said in a regulatory filing.
TCS’ IT services attrition rate continued to trend down and was at 20.1 per cent on an LTM (last-twelve-month) basis. In the previous quarter ended December 2022, the attrition rate had stood at 21.3 per cent, which was marginally lower than the 21.5 per cent during the quarter ended September 2022.
According to the latest regulatory filing, TCS’ workforce stood at 614,795 as on March 31, 2023, a net addition of 821 in Q4 and 22,600 for the year. The workforce continues to be diverse, comprising 150 nationalities and with women making up 35.7 per cent of the base.
The quarter is marked by negative events globally in the banking sector, including the collapse of Silicon Valley Bank. The IT sector has significant exposure to the BFSI sector.
Industry-wise, growth in Q4 was led by retail and CPG (13 per cent) and life sciences and healthcare (12.3 per cent). Other verticals grew in the single digits. Technology and services grew 9.2 per cent, BFSI grew 9.1 per cent, manufacturing grew 9.1 per cent, and communications & media grew 5.3 per cent.
Rajesh Gopinathan, chief executive officer and managing director of TCS, said, “It is 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. 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.”
Market-wise, TCS’ Q4 growth was led by the UK which grew 17 per cent. North America grew 9.6 per cent, while Continental Europe grew 8.4 per cent. Among emerging markets, Latin America was up 15.1 per cent, India grew 13.4 per cent, Middle East & Africa grew 11.3 per cent and Asia-Pacific grew 7.5 per cent.
N Ganapathy Subramaniam, chief operating officer and executive director of TCS, 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.”
In FY23, TCSers clocked 48.3 million learning hours, and acquired nearly 6 million competencies. With more employees returning to office, the company adopted an increasingly phygital approach to training to enable higher quality learning outcomes. Over 80,000 associates benefited from in-person training in Q4 alone.
The shares of TCS on Wednesday closed in the green ahead of the result announcement, up 0.87 per cent or Rs 27.85 to close at Rs 3,242.10 apiece on the BSE.
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