TCS Q4 results: Net profit rises 14.8% to ₹11,392 cr

IT bellwether Tata Consultancy Services (TCS) on Wednesday reported a 14.8% year-on-year jump in its consolidated net profit at ₹11,392 crore for the quarter ended March.

Revenue of India's largest software service company rose 17% year-on-year to ₹59,162 crore in the fourth quarter of 2022-23.

The company's operating margin for Q4 FY23 stood at 24.5% while net margin came in at 19.3%.

The IT giant announced a final dividend of ₹24 per share.

"It is very satisfying to look back at our strong growth in FY 2023, on top of the mid-teen growth in the prior year. The strength of our order book demonstrates the resilience of demand for our services and gives us visibility for growth in the medium term," says Rajesh Gopinathan, the outgoing chief executive officer and managing director of TCS.

K Krithivasan will take over as CEO and MD from June 1, 2023.

"Krithi and I are working closely to ensure that the leadership transition over the next few months is smooth and seamless to all our stakeholders, and that TCS is well positioned to capture the opportunities ahead," Gopinathan says.

TCS' workforce stood at 614,795 as on March 31, 2023, a net addition of 821 employees in Q4 and 22,600 for FY23. In the last financial year, the IT major onboarded over 44,000 freshers.

The attrition rate continued to trend down and was at 20.1% in FY23.

Growth in the fourth quarter was led by Retail and Consumer Packaged Goods (+13%) and Life Sciences and Healthcare (+12.3%) segments. Other verticals grew in the single digits. Technology & Services grew 9.2%, BFSI grew 9.1%, Manufacturing grew 9.1% and Communications & Media grew 5.3%.

The March quarter growth was led by the U.K. which grew 17%. North America grew 9.6% while Europe grew 8.4%. Among emerging markets, Latin America grew 15.1%, India grew 13.4%, Middle East & Africa grew 11.3% and Asia Pacific grew 7.5%.

"FY23 was a year of transition, as supply-side challenges abated while pandemic-depressed travel and discretionary spends normalized. We navigated this change well, without slowing down our investments in our people, research and innovation and intellectual property. Our longer term competitiveness remains intact, giving us industry-leading profitability even as we pursue our growth aspirations," says TCS chief financial officer Samir Seksaria.

The IT giant's full-year revenue stood at ₹225,458 crore, up 17.6% year-on-year while net income jumped 10% to ₹42,147 crore.

Cloud and Data continue to generate huge demand both internally from a talent perspective and externally from a solutions point of view, says N Ganapathy Subramaniam, chief operating officer, TCS.