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Good numbers to report: TCS CEO

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CIOL Bureau
New Update

MUMBAI, INDIA: Good numbers to report and it was a very satisfying performance across the board, said N Chandrasekaran, CEO and MD of Tata Consultancy Services (TCS), while announcing the company's first quarter results for FY2011 in Mumbai on Thursday evening.

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Belying the market estimates, India's largest software services exporter TCS reported a 31.4 per cent rise in revenues at Rs. 10,797 crore and over 26 per cent rise in net profit at Rs. 2,415 crore for the quarter ended June 30, 2011.

With operating margins over 26.1 per cent, the company pushed up net profit at 7.9 per cent quarter on quarter (QoQ), with operating profits of Rs. 2,820 crore.

S Mahalingam, CFO of TCS, said, "By focusing and optimizing operations to support our growth, we have been able to limit the erosion in operating margins by using various levers like utilization and productivity."

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He, however, added that the management remained watchful and advised people not to expect the current macro issues to impede business decision-making in those markets.

"The growth has been broad-based and excellent across multiple verticals. Telecom, hi-tech, retail, travel and hospitality verticals had a double-digit growth, apart from the BFSI and manufacturing sectors doing very well," said Chandrasekaran.

According to him, the growth during the quarter was across geographies, including the US, Europe and the UK, as well as emerging markets such as Africa and India, which were doing incredibly well.

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He, however, pointed out that the growth in Asia-Pacific was muted and it declined in Latin America. "Europe growth was the same as the company's growth level and telecom sector witnessed high growth in emerging markets, which included more of discretionary business nature projects and not annuity business," explained Chandrasekaran.

He added that there was significant growth from emerging markets, where pricing was different from other markets and the company undertook projects of system integrations.

During the quarter, TCS added 24 new clients and bagged 10 large deals with significant share from the US and Canada. It also raised the number of clients in the $50-million category to 33 from 27 and is chasing about 12 large deals.

Moreover, Chandrasekaran informed that the company had healthy deals in the pipeline that include large- as well as small- and medium-size deals. "These deals are a mix of transformational and discretionary business nature," he said.

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