India's biggest IT company Tata Consultancy Services (TCS) today reported a constant currency revenue growth of 8.4% year-on-year for the quarter ending September 30, 2019. This was below the Street's expectations. TCS announced a dividend of ₹45 per share, including special dividend of ₹40 per share. The record date of dividend is 18th October and payment date is 24th October.
The July-September quarter has historically been the strongest one for Indian IT services companies. Analysts expected TCS to report 9-9.5% year-on-year growth in revenue in constant currency terms.
TCS reported an operating margin of 24%, which was also below the Street's estimates.
CEO Rajesh Gopinathan said its Q2 order book was the highest in the last six quarters.
Here are highlights of TCS Q2 results:
Revenue at ₹38,977 crore, +5.8% YoY
Constant Currency revenue growth: +8.4% YoY
Net profit at ₹8,042 crore, +1.8% YoY
Operating Margin at 24%
Earnings Per Share at ₹1.43, +3.8% YoY
Digital Revenue at 33.2%, Growth of 27.9% YoY
Net addition of 14,097 employees in Q2
IT Services attrition rate at 11.6% LTM
Revenue growth was led by Life Sciences & Healthcare (+16%) and Communications & Media (+11.8%).
BFSI revenues grew 8%, manufacturing 7.8%, technology & services 5.6% and retail and CPG 4.8%
Commenting on the Q2 performance, CEO Rajesh Gopinathan said: "We ended the quarter with steady growth despite increased volatility in the financial services and retail verticals. We remain confident as the medium and longer term demand for our services continues to be very strong, as evidenced by our Q2 order book - the highest in the last six quarters."
TCS shares ended 0.80% lower today. The IT company announced its earnings after market hours.
CFO V Ramakrishnan said: "We have been gearing up for growth despite the volatility. Our margins in Q2 reflect our continued investments in our people, and in building the capacity we need to fulfill our strong order book."