The Hindu Business Line : Better margins boost TCS net 48 pc in Q3

Tata Consultancy Services' consolidated net profit for third quarter of the current fiscal rose 48 per cent as margins improved and clients ramped up.

Its net profit amounted to Rs 1,116 crore, against Rs 753 crore in the corresponding year-ago period.

The quarter also saw TCS' revenues, at Rs 4,873 crore, crossing the $1-billion mark, rising 49 per cent, year-on-year.

"TCS has become the first Indian IT company to clock $1 billion in revenues in a single quarter and has crossed the $3-billion mark in the first three quarters alone," said Mr S. Ramadorai, CEO and MD.

"We managed high growth rates with margin improvement and we have put the platforms in place to leverage current cost levels for higher revenues on an ongoing basis," said Mr S. Mahalingam, Chief Financial Officer.

He said the company's performance was "even more noteworthy as it has taken place against the background of a rising Indian rupee."

"TCS has delivered on the order pipeline and closed five deals of over $50 million in the third quarter. Our full-services model is in high gear and our large accounts are engaging us for new services in significant deals," said Mr N. Chandrasekaran, Executive Vice-President and Global Head, Sales and Operations.

The company is seeing billing-rate increases of between 5 per cent and 10 per cent for new orders, and between 3 per cent and 5 per cent for contracts that are being renewed, said officials.

Profit before interest depreciation and taxes rose 49 per cent, to Rs 1,426 crore from Rs 957 crore. Fifty-five new clients were added in the quarter ended December 31, 2006.

The board has recommended dividend of Rs 3 per share.

The company's scrip was almost unchanged on the bourses on Tuesday, a day after the results. It closed the day at Rs 1327.85, lower by Rs 0.05 from Monday's close.

HUMAN RESOURCES

There was a gross addition of 7,835 (net 5,562) employees during the third quarter. Domestic campus hires numbered 2,478 campus and lateral hires 4,015.

Its total employee strength at the end of the quarter was 83,500. Non-Indian nationals constituted 8.8 per cent of employees; while women constituted 25 per cent.

TCS' attrition rate for the quarter was 10.8 per cent, said a statement. For the financial year 2008, 12,372 campus offers have been made, said the company.

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