TCS reports total recovery as profit surges 47 pc in Q4

Indias largest IT company,Tata Consultancy Services,on Monday said its net profit for the fourth quarter of 2009-10 was up 47 per cent...

Indias largest IT company,Tata Consultancy Services (TCS),on Monday said its net profit for the fourth quarter of 2009-10 was up 47 per cent to Rs 1,931 crore,as compared to Rs 1,333 crore during the corresponding quarter last year,backed by huge deals and recovery across sectors and geographies.

It said the quarter denoted total recovery for the company and that it was witnessing a strong deal pipeline. TCS revenues for the quarter were up 7.9 per cent at Rs 7,737 crore,from Rs 7,172 crore during the same period last year. TCS results comes few days after Infosys Technologies,the second largest IT company,saw a drop in net profit for the quarter to Rs 1,600 crore from Rs 1,615 crore in the same period last year.

N Chandrashekaran,managing director and CEO at TCS,said,We have seen growth across verticals and geographies. We are seeing a healthy deal pipeline and we expect the growth momentum to continue for the year. During the quarter,TCS saw a volume growth of 4 per cent. It saw an impact of 1.9 per cent on the margins on the back of currency volatility,with a forex loss of Rs 190.88 crore. However,the firm said it used various levers to mitigate the impact. Its operating margins during the fourth quarter were up 51 basis points sequentially,at 28 per cent.

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For the year ended 2009-10,TCS reported a net profit of Rs 7,001 crore up 33 per cent from Rs 5,256 crore in the financial year ended 2008-09. Revenues for FY2010 were at Rs 30,029 crore,up 7.97 per cent from Rs 27,813 crore in the previous financial year. During the year,the firm saw a volume growth of 17 per cent. The operating margins for the financial year ended 2009-10 was at 26.7 per cent. During the quarter,TCS added 39 new clients.

Strong volume growth of 17 per cent during the year has rounded off an exceptional year for TCS. Our sales and execution machine is primed and we have laid a solid platform for growth. There is significant traction for our strategy of full services which together with our global engagement model positions us well for accelerated growth, Chandrashekaran said.

TCS saw an impact of 1.9 per cent on margins on the back of 7 per cent rupee appreciation against pound,sterling and euro. The additional offshore leverage brought an impact of 0.6 per cent. TCS shares closed 0.38 per cent down at Rs 811.85 on the BSE ahead of the results announcement.