An improvement in profit margins and growth across all verticals of Tata Consultancy Services (TCS) in all geographies saw the company report a 34 per cent growth in its net profit at Rs. 1,824 crore for the third quarter ended December 31, 2009, against Rs. 1,362 crore in the year-ago period.
Revenues were up 5 per cent at Rs. 7,649 crore (Rs. 7,277 crore).
The company announced a quarterly dividend of Rs. 2 per share.
The company benefited from a sequential increase in volume growth of 6.6 per cent and in operating margin and net margin which went up by 126 basis points and 176 basis points to 27.5 per cent and 24 per cent respectively.
In terms of revenues by industry practice, BFSI (banking, financial services and insurance) revenues were Rs. 3,441 crore (Rs. 3,086 crore), manufacturing Rs. 592.48 crore (Rs. 721 crore), retail and distribution Rs. 801 crore (Rs. 716.3 crore), telecom Rs. 1,113.23 crore (Rs. 1,12.7 crore) and others Rs. 1,701 crore (Rs. 1,591.2 crore).
Addressing the media, N. Chandrasekaran, CEO and Managing Director, said, “TCS yet again posted high growth and delivered on margin improvements for the third successive quarter in this difficult year. Our investments ahead of time in emerging markets, multiple industries and client relationships, is reflected in our exemplary performance.”
While the U.S. continues to lead demand recovery, the U.K. and European firms are increasingly beginning to invest for the upturn.
Asia-Pacific and India are seeing strong demand driven by growth in sectors such as energy, utilities and BFSI. The demand recovery that started in the BFSI segment has become more broad-based, with telecom and technology also positing healthy growth.
The growth momentum is also reflected across the portfolio of clients with 32 new client additions, growth in the number of active clients and addition of seven clients in the $5 million bracket.
Ajoy Mukherjee, Vice-President, Head, Global HR, TCS, said, during the third quarter, there was a gross addition of 12,854 employees (net 7,692). The utilisation rate improved to 81.1 per cent (excluding trainees) and 77.2 per cent (including trainees). “The attrition rate in the quarter was 11.5 per cent, a rate we have been maintaining and it will continue at the same level.”