TCS Q2 net profit crosses the Rs10,000-cr mark
13 Oct 2022
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Tata Consultancy Services (TCS), India's largest software services exporter, has reported an 8.4 per cent year-on-year growth in net profit to Rs10,431 crore and an 18 per cent growth in its revenue at Rs55,309 crore for the quarter ended September 2022.
The IT major also announced a second interim dividend of Rs8 per equity share.
The company's operating margin, however, contracted by 1.6 per cent to 24 per cent YoY even as PAT crossed the Rs10,000 crore mark for the first time.
“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," said TCS CEO and MD Rajesh Gopinathan.
In constant currency terms, the IT major's revenue grew 15.4 per cent YoY. The growth has been broad-based across verticals, led by retail and CMI segments. TCS's order book stood at $8.1 billion.
TCS CFO Samir Seksaria said the company is steadily making its way towards achieving 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," he said.
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 and Africa grew 8.2 per cent and the Asia Pacific grew 7.0 per cent.
TCS added 9,840 employees during the quarter. The attrition rate in IT services was 21.5 per cent on the last twelve months basis.
"We believe our quarterly annualised 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.
TCS has fixed 18 October as record date and 7 November as payment date for the second interim dividend of Rs8 per share.
"We would like to inform you that at the board meeting held today, the directors have declared a second interim dividend of Rs8 per equity share of Rs1 each of the company," TCS said in an exchange filing while announcing its quarterly results.
Tata Consultancy Services(TCS) continues to face a high attrition, which showed an upward trajectory in the September quarter, but the software major believes it has peaked and will start tapering now.
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