TCS Q1 profit up 11% on growth in IoT, cybersecurity

Indian IT services major Tata Consultancy Services (TCS) today reported a 10.8% increase in net profit to Rs 8,131 crore for the first quarter ended June 30, 2019.

Revenue increased 11.4% to  Rs.38,172 crore, an official statement said.

The company attributed the numbers to strong growth in IoT, cybersecurity, consulting and services integration areas.

TCS also said in the statement that the operating margin stood at 24.2%, while the net margin was at 21.3%.

Digital revenues increased by 42.2% year-on-year, and accounted for 32.2% of the total revenue.

The company continued investments in organic talent development by adding 12,356 new employees during the quarter, the highest in five years.

“We have had a steady start to the new fiscal year. We see customers continuing to spend on their growth and transformation initiatives, and that is showing in our strong order book and deal pipeline this quarter,” Rajesh Gopinathan, CEO and managing director, TCS, said.

He added that TCS was benefiting significantly from enterprises investing in customer experience to differentiate themselves in a Business 4.0 world. “Our lean forward strategy is working well and our customers are benefiting from the TCS innovation ecosystem,” added Gopinathan.

Chief financial officer V Ramakrishan said: “Our margins this quarter fully reflect the annual increments that we affected across the board in April. Sustained rigor in operations helped deliver strong cash conversion and EPS expansion.”

In terms of verticals, life sciences and healthcare led the pack by growing at 18.1%, while BFSI clocked 9.2% and retail registered 7.9% growth.