India's TCS posts 17% rise in Q1 profit, beats view on deal wins
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Tata Consultancy Services, India's No.1 software services exporter, reported a better-than-expected 16.8% rise in quarterly profit on Wednesday, helped by large order wins.
Consolidated net profit rose to 110.74 billion rupees ($1.35 billion) in the first quarter that ended on June 30, from 94.78 billion rupees in the year-ago period.
Analysts on average had expected a profit of 109.04 billion rupees, according to Refinitiv IBES data.
TCS is the first among its peers to report quarterly results, setting the tone for a $245 billion industry that is staring at a recession in major markets like the United States and Europe.
Revenue from operations rose 12.6% to 593.81 billion rupees.
TCS said its order book for the April-June period stood at $10.2 billion against $8.2 billion a year ago.
The order wins, which include a $1.1 billion contract with British pension scheme Nest, come at a time when IT clients are cutting discretionary spends amid high interest rates and inflationary pressures globally.
Last month, larger rival Accenture fanned concerns about dwindling IT spending, with a quarterly revenue forecast that was below Wall Street estimates.
Meanwhile, operating margins for TCS stood at 23.2%, mostly flat from a year ago, as the company rolled out its annual salary increase from which it saw a 200-basis-points hit.
The results also came amid a leadership change at the IT firm, with K Krithivasan taking over as the new CEO on June 1 in place of Rajesh Gopinathan, who resigned in March.
($1 = 82.2658 Indian rupees)
