TCS Q3 sequential net profit up 2.9% at Rs 6,778 crore

TCS Q3 sequential net profit up 2.9% at Rs 6,778 crore

Digital business registers 30.2% growth

TCS Q3 sequential net profit up 2.9% at Rs 6,778 crore

Tata Consultancy Services (TCS), the country’s largest IT services provider, reported a 2.9% rise in sequential net profit for the quarter ended December 31, 2016, at Rs 6,778 crore, compared with Rs 6,586 crore in the September quarter.

Revenues for the company during the quarter increased 1.5% sequentially to Rs 29,735 crore, against Rs 29,284 crore in Q2FY17.

Growth during the quarter was led by energy and utilities (up 5.8% sequentially), hi-tech (up 2.6% sequentially), BFSI (up 2.1% sequentially), manufacturing (up 2.1% sequentially) and retail (up 1.9% sequentially) in constant currency.

Digital business registered a 30.2% growth (Y-o-Y). Its contribution to total revenues increased to 16.8% during the quarter, against 16.1% in the September quarter, and 15.9% in the June quarter. From a geography perspective, emerging markets like Latin America and India clocked double-digit growth of 12.5% and 10.3% sequentially, respectively, while North America grew 2.2% sequentially, and the UK grew 1.7% sequentially.

“The resilience of our business model and strength of our operating strategy has been brought to the fore by our performance in Q3, traditionally a quarter of weak demand. Our strengths in digital platforms and cloud as well as our deep knowledge of the customers’ domain are driving our ability to play a strategic role and make a holistic impact on the business,” TCS Managing Director and Chief Executive Officer N Chandrasekaran said.

During the quarter, the company’s attrition rate fell to 11.3% for the last 12 months in IT services. Attrition was at 12.2% including business process services (BPS). The percentage of women in TCS rose to an all-time high of 34.6%.

According to Chandrasekaran, the company has been preparing for the H1-B Visa Reform Bill reintroduced in the US Congress last week. “There could be some changes in terms of visa fees or in the number of visas issued to IT companies, and we have been preparing well if the number of visas decline,” Chandrasekaran said.