Tata Consultancy Services (TCS) reported 4.5% fall in consolidated net profit to Rs 9,478 crore despite a 4.3% rise in revenue from operations to Rs 52,758 crore in Q1 FY23 over Q4 FY22.
Profit before tax in Q1 FY23 stood at Rs 12,776 crore, down by 4.40% from Rs 13,364 crore in Q4 FY22.
As compared with Q1 FY22, the company's net profit and revenue have grown by 5.2% and 16.2%, respectively. Net margin for the quarter ended 30 June 2022 was at 18%.
Constant currency revenue grew 15.5% YoY in Q1 FY23. Operating margin for the period under review was 23.1%, recording a contraction of 2.4% YoY.
Net cash from operations for the quarter ended 30 June 2022 was at Rs 10,810 crore, which is 114.1% of net income.
The company's order book total contract value (TCV) stood at $8.2 billion in Q1 FY23 and the book to bill ratio was at 1.2.
The board recommended a final dividend of Rs 8 per share. The record date for the same is 16 July 2022 and the payment date is 3 August 2022.
During the quarter, the growth was led by Retail and CPG (25.1%), Communications & Media (+19.6%), Manufacturing vertical (+16.4%) and Technology & Services (+16.4%). BFSI grew +13.9% while Life Sciences and Healthcare grew +11.9%.
Among major markets, North America led with +19.1% growth; Continental Europe grew +12.1% and UK grew +12.6%. In emerging markets, India grew +20.8%, Asia Pacific grew +6.2%, Latin America grew +21.6%, and Middle East & Africa grew 3.2%.
In Q1, TCS added 14,136 employees on a net basis. Employee headcount stood at 606,331. LTM IT Services attrition rate in Q1 FY23 was at 19.7% as against 17.4% in Q4 FY22.
Rajesh Gopinathan, chief executive officer and managing director, said: We are starting the new fiscal year on a strong note, with all-round growth and strong deal wins across all our segments. Pipeline velocity and deal closures continue to be strong, but we remain vigilant given the macro-level uncertainties. Looking ahead, we remain confident in the resilience of technology spending and the secular tailwinds driving our growth.
N Ganapathy Subramaniam, Chief Operating Officer and Executive Director, said: The investments we made on people, upskilling efforts and select lateral hiring et al helped manage the talent turnover with minimum impact on our operations. On the sustainability front, we have signed our commitment to SBTi version 5 standards during the quarter and are making steady progress towards our net zero journey with tremendous alignment to this initiative across our associates.
Samir Seksaria, chief financial officer, said: It has been a challenging quarter from a cost management perspective. Our Q1 operating margin of 23.1% reflects the impact of our annual salary increase, the elevated cost of managing the talent churn and gradually normalizing travel expenses. However, our longer-term cost structures and relative competitiveness remain unchanged, and position us well to continue on our profitable growth trajectory.
Tata Consultancy Services is an IT services, consulting and business solutions organization. It offers a consulting-led, cognitive powered, integrated portfolio of business, technology and engineering services and solutions.
Shares of TCS shed 0.67% to settle at Rs 3264.85 on the BSE today.
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