Net profit up 8.7%; buyback worth Rs 17,000 cr announced


IT major Tata Consultancy Services (TCS)’s net profit rose to Rs 11,342 crore in the second quarter of current financial year (Q2FY24), from Rs 10,431 crore a year earlier, the company said in a BSE filing.

The company also announced a share buyback worth Rs 17,000 crore at Rs 4,150 per share. The revenue of the company for Q2 came at Rs 59,692 crore, up 7.9 per cent year-on-year (Y-o-Y). In constant currency terms, the revenue growth was 2.8 per cent Y-o-Y.

TCS also announced a dividend of Rs 9 per share. The record date will October 9, 2023 and the payment date is November 7, 2023. 

K Krithivasan, Chief Executive Officer and Managing Director, said: “Our clients continue to entrust us with critical new technology initiatives, and large programs to digitally transform their IT and business operating models. Strong deal momentum delivered us a very large order book in Q2 – our second highest TCV ever in a quarter, and good pipeline. The resilience of demand for our services, our clients’ willingness to commit to long tenure programs and their continued appetite for experimentation with Gen AI and other new technologies give us confidence in our longer-term growth prospects.”

Growth was led by the energy, resources and utilities vertical, which grew 14.8 per cent, manufacturing grew at 5.8 per cent, and life sciences and healthcare grew at 5 per cent, the company said in a BSE filing. The consumer business group (CBG) grew 1 per cent, BFSI grew -0.5 per cent, communications & media grew -2.1 per cent and Technology & Services grew -2.2 per cent.

N Ganapathy Subramaniam, Chief Operating Officer and Executive Director, said: “We continue to make investments in our people and new technologies. We now have a 100,000-strong pool of Gen-AI Ready consultants and prompt-engineers who are engaged in hundreds of Gen-AI projects for our clients across segments.”

The company said that among major markets, the United Kingdom led with 10.7 per cent growth, while North America grew at 0.1 per cent and Continental Europe grew at 1.3 per cent. In emerging markets, Middle East & Africa grew 15.9 per cent, Latin America grew 13.1 per cent, Asia Pacific grew 4.1 per cent, and India grew 3.9 per cent.

Samir Seksaria, Chief Financial Officer, said: “Our focus on improving employee utilization, while driving productivity improvement and cost efficiency across the organization, has helped us expand our operating margin to 24.3 per cent. We will continue to push the growth, efficiency and innovation levers to further improve our profitability. In keeping with our shareholder friendly capital allocation policy, the Board has recommended a share buyback to the tune of Rs 17,000 crore at Rs 4,150 per share.”

Milind Lakkad, Chief HR Officer, said: “Our strategy of proactively hiring bright freshers and investing in training them with the right skills is paying off. With that talent coming on stream and with reduced attrition, we were able to recalibrate our gross additions, keeping it below the departures during the quarter, driving up productivity and enhancing project outcomes.”


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