TCS Q2 earnings up 8.4% sequentially to Rs 64.46 bn

TCS Q2 earnings up 8.4% sequentially to Rs 64.46 bn

India's largest software services company, today said its net profit (attributable to shareholders) fell 2.1 per cent to Rs 6,446 crore in the September quarter of the current fiscal. TCS had reported a net profit of Rs 5,945 crore on revenues of Rs 29,584 crore in the quarter ending June 30, 2017.

Revenues at the country's biggest software services exporter were in line with forecasts at Rs 30,541 crore, rising 3.2% over the June quarter.

On the second quarter performance, Rajesh Gopinathan, CEO and MD, said: "We experienced robust volume growth in Q2, driven by good demand across multiple industry verticals". Strong, broadbased client metrics this quarter demonstrates our Increasing success with newer customers.

He added that the company continues to gain share in the fast growing "digital spend" of its customers.

"Large deal wins this quarter, a good pipeline and bottoming out of the retail sector softness position us well", chief executive Rajesh Gopinathan said on Thursday.Europe grew sequentially in constant currency by 5.3%, United Kingdom by 2.5% and Latin America by 5.7%.

Revenue at $4,739 million in Q2 was up 3.2 per cent from $4,591 million quarter ago and 8.3 per cent up from $4,374 million in the like period year ago.

It, however, considered that amount as a "contingent liability".The company, which is the crown jewel of the Dollars 104 billion salt-to-software Tata Group, declared a dividend of Rs7 per share and set October 26 as the record date.Analysts at domestic brokerage Emkay Global said the numbers are ahead of its estimates, welcoming the surge in themargins.

Tata Consultancy Services Ltd (TCS) trailed already low growth estimates for the September quarter.

With the exception of retail and communication & Media industries (CMI), all industry verticals grew above the company average led by travel & hospitality (up 8 per cent QoQ), energy & utilities (up 7.2 per cent) and life sciences and health care (up 3.6 per cent).

Banking, financial services and insurance (BFSI), the bread and butter for all Indian IT service providers, grew 1.9% against 2.3% in the previous quarter on a constant currency basis, while retail fell almost 1%, from a growth of 2%, as traditional retailers hobble under the onslaught of online counterparts.

TCS Chief Operating Officer N. Ganapathy Subramaniam said headwinds across sectors are slowly abating.

TCS said growth was led by Europe (up 5.3 per cent Q-o-Q), Latin America (up 5.7 per cent Q-o-Q), APAC (up 3 per cent Q-o-Q) and United Kingdom (up 2.5 per cent Q-o-Q).

Business in North America which generates more than half of TCS's revenues remained soft as the BFSI vertical continued to lag.

"Our investment programme remains geared for growth".

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