TCS reports 7% higher profit in best Q3 over nine years

Tata Consultancy Services (TCS) on Friday reported a 7.2% growth in its latest quarterly profit, deriving the country’s largest IT services exporter’s strongest growth in nine years.

The company said its net profit attributable to shareholders rose to Rs 8,118 crore, or Rs 23.19 per share, in the third quarter of financial year 2020-2021, ended December, from Rs 8,701 crore, or Rs 21.63 per share, a year earlier.

Revenue from operations rose 5.4% to Rs 42,015 crore. Operating margin stood at 26.6%, up 1.6% year over year.

“Growing demand for core transformation services and strong revenue conversion from earlier deals have driven a powerful momentum that helped us overcome seasonal headwinds and post one of our best performances in a December quarter,” TCS CEO Rajesh Gopinathan said in a statement.

Cloud adoption will remain a secular trend for the quarter to come, Gopinathan added in the earnings call with analysts. The company saw a total contract value of $6.8 billion in deal wins in the quarter.

Companies such as TCS and rivals Infosys and Wipro have added multiple billion-dollar deals in the past calendar year, owing to a surge in demand for digital transformation at enterprises across sectors in the wake of the Covid-19 crisis.

Banking and finance industries (BFSI), TCS’ top revenue contributor, jumped 7.6% to Rs 16,655 crore, year over year.