Tata Consultancy Services on Wednesday posted its fiscal first quarter profit at Rs 11,074 crore, up 16.8 per cent in comparison to Rs 9,478 crore during the same period last year. TCS net profit surpassed estimates of Rs 10,866 crore. The IT services major posted its revenue from operations for Q1FY24 at Rs 59,381 crore, up 12.6 per cent as against Rs 52,758 crore during the first quarter of FY23. According to a CNBC TV18 poll, it was expected to post revenue for the quarter at Rs 59,450 crore. While the total income for the quarter was at Rs 60,778 crore, TCS posted total expenses during Q1FY24 at Rs 45,789 crore. TCS also declared an interim dividend of Rs 9 per equity share of Re 1 each of the company.
“It is very satisfying to start the new fiscal year with a string of marquee deal wins. We remain confident in the longer-term demand for our services, driven by the emergence of newer technologies,” said K Krithivasan, Chief Executive Officer and Managing Director, TCS.
TCS’ Q1FY24 performance across segments
TCS’ banking, financial services and insurance segment posted revenue at Rs 22,662 crore, while the manufacturing sector was at Rs 5,636 crore. Its retail and consumer business segment recorded a revenue of Rs 9,876 crore, communication, media and technology sector posted revenue at Rs 9,596 crore, and the life sciences and healthcare business was at Rs 6,636 crore.
TCS said that the business growth among various industries was led by the life sciences and healthcare sector which grew 10.1 per cent and the manufacturing vertical which was up 9.4 per cent. Meanwhile, BFSI grew 3 per cent, retail and CPG was up 5.3 per cent, technology and services grew 4.4 per cent and communications and media was up 0.5 per cent.
“Our products and platforms achieved major milestones during the quarter with several transformational engagements going live. In the UK Life and Pensions administration space, we signed three new deals on our digital insurance platform,” said N Ganapathy Subramaniam, Chief Operating Officer and Executive Director, TCS.
Among performing markets, TCS said that the United Kingdom led with 16.1 per cent growth, North America grew 4.6 per cent and Continental Europe grew 3.4 per cent. Also, among emerging markets, while the Middle East & Africa grew 15.2 per cent, India posted a growth of 14 per cent, Latin America grew 13.5 per cent, and Asia Pacific grew 4.7 per cent.
TCS’ workforce addition and retention during Q1FY24
TCS’ workforce stood at 615,318 as on June 30th, with a net addition of 523 during the quarter. The company rolled out its annual salary increase across its workforce, with effect from April 1, 2023. “Our operating margin of 23.2 per cent reflects the 200-bps impact of this hike, offset through improved efficiencies. At the same time, we continue to make the investments needed to power our future growth, including expansion of our delivery and research infrastructure,” said Samir Seksaria, Chief Financial Officer, TCS.
Further, 55 per cent of its workforce are working from the office thrice a week. “Our attrition continues to trend down and we expect it to be back in our industry-leading, long term range in the second half of the year. While we are committed to honor all the offers we have made, our focus will be on leveraging the capacity we built last year,” said Milind Lakkad, Chief HR Officer, TCS.