TCS Q4 net jumps 14.9 pc on higher revenues

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Mumbai, Apr 12 (PTI) The country's largest tech exporter TCS on Monday reported a 14.9 per cent jump in its consolidated net profit for the March quarter to Rs 9,246 crore on higher profit margins and revenue growth.

It posted a marginal increase in reported post-tax profit at Rs 32,430 crore for FY21, despite a 4.6 per cent jump in revenue to Rs 1.64 lakh crore in the last fiscal.

The company, a cash-cow for the over USD 100 billion Tata Group, said it is optimistic from a demand perspective and is targeting to grow the topline in double-digits in the next few years.

TCS chief executive and managing director Rajesh Gopinathan on an analyst call said that FY22 will be an 'aberration' from a revenue growth perspective, hinting at the low base throwing up a higher growth number.

Its overall revenues in Q4 FY21 stood at Rs 43,705 crore, 9.4 per cent higher when compared to the year-ago quarter's 39,946 crore, and the operating profit margin widened by 0.2 per cent to 26.8 per cent.

From a fresh orders perspective, the total contract value achieved during the quarter stood at the highest ever of USD 9.2 billion, while the same for the fiscal stood at USD 31.6 billion.

Gopinathan said the company is not facing any pricing pressures but hinted that the large size deals, which had come down during the pandemic, are coming back now even as the overall volume of small deals continues to be high.

He pointed out that the largest deal it has cracked in the reporting quarter is over USD 800 million as against USD 2 billion in the year-ago period. He, however, added that this cannot be called a trend.

The company added 19,388 employees in the January-March period, making it the highest ever quarterly addition, and 40,000 employees during FY21 to take its overall base to 4.88 lakh.

Its chief of human resources Milind Lakkad told reporters that it does not see a significant challenge on talent supply, and has made an equal number of offers for hiring freshers from campuses as last year.

The attrition rate dipped to the lowest ever of 7.2 per cent, but chief financial officer V Ramakrishnan said it will inch up with overall growth in the industry, once it comes out of the pandemic impact.

During the quarter, it set aside a provision of Rs 1,218 crore towards a legal case filed by Epic Systems, which it continues to contest, Ramakrishnan said.

In the reporting quarter, banking, financial services and insurance delivered a healthy growth of nearly 5.5 per cent, while other segments like retail and consumer, manufacturing, and communication, media and technology also showed some marginal growth.

From a geographical perspective, all the markets showed negative growth in FY21, except continental Europe, which grew by over 5 per cent. Revenues from India grew by over 11 per cent.

The company was the first major member of India Inc to announce its earnings, and rivals - including Infosys and Wipro - will announce their March quarter and FY21 numbers on April 14 and April 15, respectively.

'During the last year, though IT Services revenue remained under pressure, we see good signs of recovery for TCS. They appear to have a healthy business pipeline as well,' DD Mishra, a senior research director at Gartner, said.

The company board recommended a final dividend of Rs 15 per share, taking the total dividend payout, including interim ones, to Rs 37 per share during FY21.

The company's share closed at Rs 3,241.45 apiece on the BSE, down 2.43 per cent, as against a 3.44 per cent correction on the benchmark. PTI AA SR BAL