Published: Fri, October 13, 2017
Money | By Armando Alvarado

TCS shares gain over 2% after Q2 results

TCS shares gain over 2% after Q2 results

In the first quarter, the company had reported net profit of Rs 5,945 crore.

Under the International Financial Reporting Standards (IFRS) or in dollar terms, the net income at $1,000 million in Q2 was up 8.4 per cent from $923 million quarter ago and 1.6 per cent up from $984 million in the same period year ago. The company has declared a dividend of Rs 7 per share.

India's largest IT company, has posted a 2.1 per cent decline in net profit at Rs 6,446 crore for the second quarter ended September 2017 as against Rs 6,586 crore in the same period of a year ago. Net profit for the second quarter, ended September 30, rose 8.3% to touch $1billion.

Commenting on the Q2 performance, Rajesh Gopinathan, CEO and MD, said, "We experienced robust volume growth in Q2, driven by good demand across multiple industry verticals".

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Banking, financial services and insurance (BFSI), the bread and butter for all Indian IT service providers, grew 1.9% against 2.3% in the previous quarter on a constant currency basis, while retail fell almost 1%, from a growth of 2%, as traditional retailers hobble under the onslaught of online counterparts.

The results of TCS, the first to report quarterly earnings among Indian software exporters, augur well for the nation's information technology sector amid concerns companies could report muted financial performance in the second quarter because of a slowdown in the USA financial services and retail industries.

All segments of the business, except the banking, financial services and insurance (BFSI) and retail sectors, grew revenue above 9.5 percent.

Digital business grew 31% from a year earlier, accounting for 20% of the overall revenue, Gopinathan said. "We expect stronger and steadier growth ahead". North America grew by 1.4 per cent Q-o-Q with continued softness in banking and retail. The operating margin improved by 170 basis points to 25.1 per cent after hitting the lowest level of 23.3 per cent in the previous quarter since the March 2008 quarter. The total volume of shares traded was 186,876 at the BSE (Thursday).

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