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Outsourcing deals boost quarterly net profit at TCS

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Reuters MUMBAI
Last Updated : Jul 17 2014 | 6:46 PM IST

By Aman Shah and Nivedita Bhattacharjee

MUMBAI (Reuters) - Tata Consultancy Services , India's biggest software services exporter, posted a 26.9 percent increase in quarterly net profit, as it won large outsourcing deals from Western clients in sectors including retail and life sciences.

TCS, which counts Cisco and Hewlett-Packard among its customers, has increased profits at a faster pace than rivals Infosys Ltd and Wipro Ltd , which have both had internal management changes over the last two years.

In that period, TCS has bet on higher IT spending by clients in the financial services, retail and life sciences sectors to boost growth as the global and U.S. economies recover.

Consolidated net profit for the three months to June 30, its financial first quarter, rose to 50.58 billion rupees ($840.5 million) from 39.87 billion rupees a year ago, the Mumbai-based company said on Thursday.

That compares with analyst estimates of 48.86 billion rupees, according to Thomson Reuters data.

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Revenue rose 22.9 percent to 221.11 billion rupees.

TCS, which gets more than three-quarters of its revenue from the United States and Europe, said business volume grew 5.7 percent, led by a growth in North America, Europe, India and the Asia-Pacific region.

Shares in Tata Consultancy, a unit of Tata conglomerate, closed 0.8 percent lower at 2,381.95 rupees before the announcement. The main Mumbai market index was up 0.2 percent.

($1 = 60.1800 rupees)

(Editing by Miral Fahmy and Pravin Char)

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First Published: Jul 17 2014 | 6:24 PM IST

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