TCS net profit declines 2.5% in Q3, announces dividend of Rs 27 per share

TCS Q3 results: Tata Consultancy Services (TCS) announced its third quarter financial results on Thursday. The company’s profit fell 2.50 per cent to Rs 11,058 crore, from Rs 11,342 crore in the previous quarter of the same fiscal (Q2FY24).

The fall in the profit came on the back of one-time settlement of a legal claim of Rs 958 crore.

However, the IT major’s revenue soared 1.5 per cent to Rs 60,583 crore, from Rs 59,692 crore in Q2FY24.

Operating profit, also known as EBIT surged 4.6 per cent to Rs 15,155 crore, from Rs 14,483 crore in Q2FY24. Its margin jumped 76 basis points to 25.02 per cent in Q3 FY24, from 24.3 per cent in Q2 FY24.

The company also declared a third interim dividend of Rs 9 and a special dividend of Rs 18 per equity share of Rs 1 each of the company.

TCS’ order book for the third quarter came in at $8.1 billion, while Book to Bill ratio stood at 1.1.

“Growth was led by the energy, resources and utilities vertical which grew 11.8 per cent, manufacturing which grew 7 per cent and life sciences and healthcare which grew 3.1 per cent,” TCS said in a statement. 

K Krithivasan, Chief Executive Officer and Managing Director, said, “Our strong performance in a seasonally weak quarter buffeted by macroeconomic headwinds, demonstrates the strength of our business model with a well-diversified portfolio and a customer centric strategy. We are seeing strong deal momentum across markets resulting in a solid order book providing visibility into our long-term growth. We are seeing tremendous interest in Generative AI and are leading the innovation and exploratory efforts for our customers in this area.”

The company’s attrition rate stood at 13.3 per cent during the December quarter.

Milind Lakkad, Chief HR Officer, said, “The vibrancy and energy levels in our offices are increasing as more and more of our employees are back in the offices. We expect to be back to our normal operating mode by the end of the current fiscal year. Parallelly, attrition is trending down and at 13.3 per cent, is now in our range of comfort. We are committed to hiring from college campuses and growing talent organically. We have commenced our campus hiring process for the next year and see tremendous excitement among freshers to join TCS.”

The shares of the company settled 0.61 per cent to Rs 3,736.20 per share when the market closed today, January 11, 2024.