TCS Q4 net profit up 14.8% to Rs 11,436 crore, deal TCV at $10 billion

Tata Consultancy Services (TCS), India’s largest IT services company by revenue, kicked off the fourth quarter earnings season on Wednesday with a 14.8% YoY rise in net profit to Rs 11,436 crore. TCS follows an AprilMarch fiscal year.

The Mumbai-headquartered company’s revenue for the March quarter grew nearly 17% from a year ago to Rs 59,162 crore, driven by long-term demand for technology-led transformation.

The dollar revenue for the March quarter grew 10.7% in constant currency from a year earlier to $7.2 billion. This is despite Q4 being a seasonally weak quarter on account of furloughs or lower number of working days due to holidays. The total contract value (TCV) in Q4 stood at $10 billion with all-time high number of large deals. For FY23, the order book stood at $34.1 billion.

“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. 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,” said Rajesh

Infosys pegs muted FY24 revenue growth guidance at 4-7%

Infosys, India’s second largest software exporter by revenue, has forecast its FY24 revenue growth to be in the range of 4-7% in constant currency, on the back of an uncertain demand environment and some unplanned project ramp downs and delays in decision making in Q4. The operating margin guidance for FY24 stood at 20-22%. Infosys follows an AprilMarch fiscal year.

and MD, TCS

Gopinathan, CEO and MD, TCS.

Gopinathan added that the company is not seeing any large-scale budget transformations though some “discretionary projects are being deferred.”

The Bengaluru-based company’s net profit for the March quarter rose 7.8% from a year ago to Rs 6,128 crore, below Bloomberg estimates of Rs 6,582.2 crore.

The revenue for the March quarter rose 16% annually to Rs 37,441 crore on broad-based growth, below Bloomberg estimates of Rs 38,769.8 crore. The revenue for FY23 grew 15.4% in constant currency to Rs 146,767 crore, below its guidance of 16-16.5%.

The dollar revenue declined 3.2% sequentially in constant currency to $4.5 billion due to deal ramp downs and a one-time revenue impact. In comparison, Tata Consultancy Services’ (TCS) dollar revenue grew 0.6% sequentially to $7.2 billion during the fourth quarter, below market expectations. During Q4, Infosys signed large deals worth a total contract value of $2.1 billion.

Operating margins for the March quarter narrowed to 21% from 21.5% compared to the December quarter. “Our continued focus on cost optimization and operational efficiencies have helped in achieving operating margins of 21% in FY23,” said Nilanjan Roy, Chief Financial Officer, Infosys.