TCS net profit falls 10% to Rs

  • TCS net profit falls 10% to Rs

TCS net profit falls 10% to Rs

The Mumbai-based IT firm reported the biggest fall in its quarterly net profit in two years.

Adding to the sector's woes, the Indian rupee has appreciated about 5 percent this year against the US dollar, making exports costlier.

"We have seen steady growth across industries in Q1". The rupee has also risen over 5 per cent against the dollar this year. Among the company's other businesses, Retail & Consumer Products Group's revenue was up 2%; Lifescience & Healthcare was up 4.7%; while manufacturing was up 3.8% in constant currency terms.

TCS was seeing a "strong pipeline" for new deals in the key North American market, especially from smaller customers, Chief Executive Rajesh Gopinathan told a news conference.

The Employee took this scenario to Uttar Pradesh Chief Minister Yogi Adityanath by writing a letter stating that the employees have asked for an inquiry of how a company earning Rs 25,000 crore in profits could be short of funds. Operating margin came in at 23.40 per cent.

The appreciation of the rupee resulted in a loss of 6.50 billion rupees in reported revenue, TCS added. But V Ramakrishnan, CFO, TCS said they will "remain disciplined" in financial management and in generating strong cash flows.

India's $150-billion IT sector has always been one of its flagship industries but is facing upheaval in the face of automation, a failure to keep up with new technologies and US President Donald Trump's clampdown on visas. The total attrition rate (LTM) was at 12.4 per cent including BPS, with IT attrition at only 11.6 per cent.

During Q1, TCS reorganised its service lines in Q1, adding new lines like cognitive business operations (grew by 5 percent QoQ) and digital transformation services, which have robust pipeline. TCS' global HR Head Ajoy Mukherjee said: "We continue to hire talent across markets and help TCSers gain new digital skills so that they can participate successfully in digital economy".