Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2018 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
TCS: Sound performance on all parameters - Views on News from Equitymaster
  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

TCS: Sound performance on all parameters
Oct 20, 2012

Tata Consultancy Services (TCS) has announced its second quarter results of financial year 2012-2013 (2QFY13). The company reported a 5.1% quarter-on-quarter (QoQ) growth in its consolidated sales and a 7.1% QoQ increase in its consolidated net profits. Here is our analysis of the results.

Performance summary
  • Net sales grew by 5.1% QoQ in 2QFY13, the growth of sales in USD terms was very similar at 4.6%QoQ, while the constant currency growth was 4.8%QoQ. This implies that rupee depreciation did not have a meaningful impact on revenue growth during the quarter.
  • Operating margins declined marginally by 0.7% QoQ to 26.8% during the quarter as compared to 27.5% seen during the previous quarter (1QFY13). This was mainly due to higher cost of revenues (QoQ percentage increase of 0.85% on sales). This offset the positive impact of lower 'selling, general and administrative' expenses (QoQ percentage decrease of percentage decrease of 0.09% on sales).
  • Notwithstanding the slight margin contraction at operating levels, net profits grew by 7.1% QoQ on an absolute basis. Net profit margin improved by 0.4% to 22.5%. The growth in net profits was aided by higher other income during the quarter as well as a lower effective tax rate. The latter stood at 21% in 2QFY13 as compared to 22.2% in 1QFY13.
  • TCS added a net of 10,531 employees during the quarter. The total headcount of the company was 254,076 at the end of 2QFY13.
  • Attrition rate continued to drop and stood at 10.2% in IT services segment, lower than the 10.9% seen during the 1QFY13. In the BPO segment, attrition rate rose slightly to 20.9% as compared to 20.7% seen during 1QFY13.
  • The company added 41 new clients during the quarter. The total number of active clients at the end of the period was 1,041.
  • The company has declared a second interim dividend of Rs 3 per share (dividend yield of 0.2%)

To Read the Full Story, Subscribe or Sign In

Small Investments
BIG Returns

Zero To Millions Guide 2018
Get our special report, Zero To Millions
(2018 Edition) Now!
We will never sell or rent your email id.
Please read our Terms


Feb 22, 2018 (Close)