TCS Share Q3 Results

TCS

Corporate Action
by 5paisa Research Team Last Updated: 2022-08-08T18:43:30+05:30

India’s largest software company and the second most valuable company in terms of market, TCS, announced its December 2021 quarter results on 12 January. The results in a way set the trend for other results. The broad takeaway was that while the revenues were up, the operating margins took a hit on account of higher operating costs.

For the quarter ended Dec-21, Tata Consultancy Services reported 16.35% YoY growth in total top line revenues at Rs.48,885 crore on a consolidated basis. On a sequential basis, the revenues were up by a more modest 4.31%. That big growth thrust came from the North American region which saw 18% growth in the Dec-21 quarter.
 

A Quick View of Quarterly Numbers of TCS for Dec-21 Quarter
 

Rs in Crore

Dec-21

Dec-20

YOY

Sep-21

QOQ

Total Income (Rs cr)

₹ 48,885

₹ 42,015

16.35%

₹ 46,867

4.31%

Operating Profit (Rs cr)

₹ 12,237

₹ 11,184

9.42%

₹ 12,000

1.98%

Net Profit (Rs cr)

₹ 9,769

₹ 8,701

12.27%

₹ 9,624

1.51%

Diluted EPS (Rs)

₹ 26.41

₹ 23.19

 

₹ 26.02

 

OPM

25.03%

26.62%

 

25.60%

 

Net Margins

19.98%

20.71%

 

20.53%

 

 

During the quarter, TCS added a total of 10 bulge bracket clients in the $100 million plus category while it also added 21 clients in the $50 million plus category. As anticipated, TCS has announced a massive buyback program of Rs.18,000 crore with the buyback price set at Rs.4,500 per share. The company has also declared an interim dividend.

On a sectoral basis, retail and CPG grew 20.4%, BFSI 17.9%, Manufacturing 18.3% while Technology and Services grew at 17.7% and life sciences and media grew at 16.3% and 14.4% respectively. North America represented regional growth of 18% while continental Europe grew at 17.5% and UK grew at a more modest pace of 12.7%. The Indian market was also up by 15.2% 

Operating profit was up 9.42% at Rs.12,237 crore but there were clear signals of growth weakening due to operating cost pressures. This was more pronounced on travel, manpower and sub-contracting. Operating margins narrowed by almost 159 bps YoY, what CRISIL had pencilled for IT companies.

Profit after tax (PAT) for the Dec-21 quarter was up 12.27% at Rs,9,769 crore on a YoY basis. There was strong traction in high value clients but the impact of higher operating costs got transmitted to the bottom line also. TCS had the lowest levels of attrition at 15.3% in the IT industry but despite that, the PAT margins narrowed from 20.71% to 19.98% on a YoY basis.


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