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TCS Q3 Net Profit Jumps 11% YoY To Rs 10,846 Crore, Revenue Up 19.1%, Special Dividend Declared

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TCS Q3FY23 Earnings: India’s largest IT services company Tata Consultancy Services (TCS) on Monday reported a consolidated net profit of Rs 10,846 crore for the December 2022 quarter, a jump of 11 per cent on a year-on-year basis. During October-December 2022, TCS’ revenue rose 19.1 per cent year-on-year to Rs 58,229 crore.

On a constant currency basis, TCS revenue jumped 13.5 per cent during the December 2022 quarter, according to a BSE filing.

TCS’ board also declared a third interim dividend of Rs 8 and a special dividend of Rs 67 per equity share of Rs 1 each of the company. “The third interim dividend and the special dividend shall be paid on Friday, February 3, to the equity shareholders of the company, whose names appear on the company’s Register of Members or in the records of the depositories as beneficial owners of the shares as on Tuesday, January 17, 2023, which is the Record Date fixed for the purpose,” according to a regulatory filing.

TCS’ total dividend per share stood at Rs 75 per share during the December 2022 quarter, including Rs 67 as special dividend. Its record date stood at January 17, 2023, and the payment date of Febuary 3, 2023.

During the current fiscal till date, TCS’ total shareholder payout stood at Rs 33,297 crore

The company’s operating margin during October-December 2022 stood at 24.5 per cent, which a contraction of 50 basis points (100 bps is equal to 1 percentage point) as compared to last year. Its net margin during the quarter stood at 18.6 per cent.

Rajesh Gopinathan, chief executive officer and managing director of TCS, said, “We are pleased with our strong growth in a seasonally weak quarter, driven by cloud services, market share gains through vendor consolidation, and continued momentum in North America and UK.”

He added that the sustained strength of demand for our services is a validation of the value we provide to TCS’ clients in helping them differentiate themselves, while enhancing their competitiveness. “Looking ahead, and beyond current uncertainties, our longer-term growth outlook remains robust.”

TCS’ IT services attrition rate stood at 21.3 per cent, which is marginally lower than the 21.5 per cent during the previous quarter ended September 2022.

Samir Seksaria, chief financial officer of TCS, said, “Improved productivity, currency support and abating supplyside challenges helped expand our operating margin in Q3. This gives us greater confidence in our ability to steer our profitability towards our preferred range, while continuing to invest in building newer capabilities to support our growth and market share gains.”

During the December 2022 quarter, TCS saw a fall in its net headcount by 2,197. Its workforce strength as of December 31, 2022, stood at 6,13,974.

TCS had reported a net addition of 9,840 employees during July-September 2022. With this, the company’s workforce as of September 30, 2022, had stood at 6,16,171.

Milind Lakkad, chief HR Officer, said, “Our focus over the last few quarters on bringing in fresh talent at scale, training them on new technologies and making them productive is paying off. We are particularly proud of having 125,000 TCSers at middle and senior levels who have been with the company for more than 10 years on average.”

He said they have been central to the successful cultural integration of all the fresh talent TCS has onboarded in the last couple of years, and their contextual knowledge and customer-centricity have been key to the high level of customer satisfaction that TCS is known for.

Ahead of the results announcement, shares of Tata Consultancy Services (TCS) on Monday jumped Rs 107.7, or 3.35 per cent, to close at Rs 3,319.7 apiece on the BSE.

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