TCS Q4 profit jumps 14.9% to Rs 9,246 cr

The country's largest software services firm Tata Consultancy Services (TCS) on Monday reported a 14.9 per cent rise in consolidated net profit to Rs 9,246 crore for the March 2021 quarter.

This is against a net profit of Rs 8,049 crore in the year-ago period, TCS said in a regulatory filing.

The revenue of the IT major grew 9.4 per cent in the quarter under review to Rs 43,705 crore from Rs 39,946 crore a year ago, it added.

"Our investments over the last decade in building newer capabilities, and in research and innovation, position us well for the multi-year technology services opportunity ahead.

“While we continue to dominate in our traditional areas of strength, we are making good progress in gaining share in the growth and transformation opportunity," TCS chief executive officer and managing director Rajesh Gopinathan said.

The firm's focus going into FY22 will be to engage with clients in their growth agenda, propelled by innovation and leverage of collective knowledge, he added.

The net profit for the fiscal ended March 2021 was up at Rs 33,388 crore (excluding legal claim provisions), from Rs 32,340 crore in the previous financial year.

Its net profit on a reported basis stood at Rs 32,430 crore for FY21.

TCS had provided Rs 1,218 crore ($165 million) towards a legal case (relating to Epic Systems Corporation) in its consolidated statement of profit and loss for the year ended March 31, 2021.

The revenue was higher by 4.6 per cent to Rs 164,177 crore in FY21 from Rs 156,949 crore in the preceding financial year, the filing said.

The Board of Directors has proposed a final dividend of Rs 15 per equity share.

V Ramakrishnan, chief financial officer at TCS, said the company's performance in the fourth quarter "caps three-quarters of consistently robust performance in a pandemic year, and gives us a strong exit from FY21".

"Our Q4 margins are a validation of our strong belief that it is possible to win mega-deals, post industry-leading growth, continue to invest in our people and in newer capabilities, and still deliver industry-leading profitability," he added.

Ramakrishnan further said that all the investments made by the company over the years have positioned it strongly to expand its footprint in the large growth and transformation opportunity.

The fourth-quarter order book at $9.2 billion is the highest-ever TCV (total contract value) in a quarter.

The FY21 order book was at $31.6 billion, up 17.1 per cent year-on-year, the filing said.

TCS announced its results after market hours. Its scrip closed at Rs 3,241.45 apiece, down 2.43 per cent from its previous close on the BSE.

Its rivals Infosys and Wipro will announce their March quarter and FY21 numbers on April 14 and April 15, respectively.

In the fourth quarter, TCS added 19,388 employees to its rolls on a net basis, its highest ever net addition in a quarter, taking the total headcount to 488,649.

IT services attrition rate (LTM) was at 7.2 per cent.

"With the second wave of the pandemic upon us, our top priority is once again to secure the health and personal wellbeing of our workforce across the world.

“We are looking at ways to expedite vaccinations for eligible TCSers wherever local regulations allow it," TCS chief HR officer Milind Lakkad said.