Mumbai: Tata Consultancy Services Ltd (TCS) reported revenue growth of 11.9% in constant currency terms for the year ended March, slower than industry body Nasscom’s growth estimate of 12.3% for the country’s $150 billion outsourcing sector.

Further underlining the pain at India’s largest software services firm, it reported a 1.5% rise in dollar revenue on a sequential basis for the quarter ended March and ended the financial year with 7.1% dollar revenue growth, its slowest yearly pace since 2009-10.

At the heart of TCS’s underperformance (the company has recorded slow growth since July 2014) is the company’s inability to generate more business from existing clients.

“The only way a company of the scale of TCS can record higher growth is by making acquisitions. And for far too long it has shied away from it," said a Mumbai-based analyst at a domestic brokerage who did not want to be named.

TCS’s sub-par performance over the last 18 months offered a chance to Infosys to gain ground. Under chief executive officer (CEO) Vishal Sikka, Infosys has reinvigorated itself and regained the tag of industry bellwether as it ended the last financial year with industry-leading growth of 13.3% in constant currency terms. The Bengaluru-based firm had hit rock-bottom in June 2014.

The TCS management declined to comment whether the company would manage to beat Nasscom’s estimate of 10-12% revenue growth in the current financial year. Infosys has outlined growth of 11.5-13.5% in constant currency in the current year.

In the year gone by, TCS saw its dollar revenue grow 7.1% from the year-ago period to $16.54 billion, less than half of the 15% pace at which it expanded in the previous year. Net income rose 14.8% to $3.69 billion from the prior year.

TCS reported revenue of $4.2 billion in the quarter to 31 March, up 1.5% from the preceding quarter and 7.9% from the year-ago period. Net income rose to $938 million, up 1.3% on a sequential basis and 50.9% from the year-ago period.

A Bloomberg survey of 34 analysts had forecast TCS to report revenue of $4.27 billion and net profit of $945.86 million in the quarter.

TCS’s financial performance paled in comparison with that of Infosys, its closest rival, which ended the year with 9.1% dollar revenue growth, and last week said it expects dollar revenue to expand between 11.8% and 13.8% in the year to 31 March 2017.

TCS’s 2.1% sequential growth in constant currency terms in the January-March period beat Infosys’s 1.9% growth. However, Infosys’s growth in dollar terms was 1.6%, above TCS’s 1.5% quarter-over-quarter growth.

TCS does not give quarterly or yearly forecasts but its CEO Natarajan Chandrasekaran said the financial year 2016-17 should be strong.

“We ended the year on a stronger note," said Chandrasekaran. “Diligenta, Japan and Telecoms hurt our annual growth in CC (constant currency terms) by 2%."

Japan brings roughly about $550 million and the company said that it will need to wait for some more time before the East Asian country can drive growth for the company.

“The negativism we had in certain segments is gone and we should do well," said Chandrasekaran.

Analysts were sceptical.

“You could say it was a good quarter because the company lived up to what it had said," an analyst with a Mumbai-based international brokerage said, but added that the expectations were low coming into the quarter.

“It doesn’t move the needle much" as there is little visibility on TCS’s growth prospects for the year ahead, added the analyst, who did not want to be named.

Nevertheless, the quarter did bring some cheer to TCS.

For starters, its insurance business has turned the corner. Also, the management does not expect its UK-based business process outsourcing division Diligenta to “go down" any further.

TCS’s largest revenue segment—banking, financial services and insurance (BFSI), which accounts for over 40% of its revenue—grew 3.2% sequentially in constant currency terms. North America, which brings 56% of its business, improved 2.4% in the fourth quarter. Growth in BFSI and demand from US were higher for TCS than for Infosys.

Digital revenue now account for 15.5% of TCS’s total revenue, it said.

TCS added 22,567 employees in the fourth quarter, bringing its total employee strength to 353,843. The company has decided to give an average wage hike of 8% to its employees; high-performers can expect as much as 12%.

TCS added three new clients in the quarter who brought in more than $100 million in annual revenue.

The TCS management declined comment on last week’s development where a Wisconsin federal jury ordered it to pay a $940 million fine to a privately held firm, Epic Systems Corp., in an intellectual property rights case, and stayed away from shedding light on the impact it will have on its financials. TCS is expected to contest the jury’s decision.

“Presumably, TCS is aggressively reaching out to all stakeholders and working overtime to do damage control," said a 17 April note from Kotak securities.

On Monday, TCS shares fell 0.03% to 2,522.40 on the BSE, while the benchmark Sensex rose 0.74% to 25,816.36 points. The results were announced after the close of trading.