12 Jul , 2024 By : Debdeep Gupta
Tata Consultancy Services has maintained its earlier view that the current year will improve over the last, driven by growth across global operations and strength in major business verticals.
"There's nothing new to add in terms of market sentiments. However, as mentioned last quarter, we anticipate FY25 to surpass FY24, and we maintain that stance. We believe it will be a stronger FY25 compared to FY24," CEO K Krithivasan said at a press conference to discuss the June quarter numbers.
The management noted that Latin America, the Middle East Africa, and India continued to have strong growth in line with their diversification strategy.
About the 18 percent decline in the order book to $8.3 billion, Krithivasan said, "It remains consistent, which gives us confidence, especially considering our qualified pipeline and total pipeline are near all-time highs. It's a matter of timing in terms of how much gets booked in a specific quarter."
Addressing revenue expectations, he said, "In our current revenue range of about $7 to 9 billion, Total Contract Value (TCV) is a crucial component, intertwined with other factors. We do not foresee any specific issues."
Moreover, he attributed the decline of the Total Contract Value (TCV) to timing rather than fundamental weakness. He added that they were not worried about it being lower than last quarter, as the pipeline remained strong. The company reported a total contract value of $8.3 billion in Q1, which has declined both on a YoY and sequential basis.
Growth across industries and markets
"Almost all our verticals and geographies have shown growth," Krithivasan said, adding that the growth across industries and markets was led by cost optimization and business transformation.
"Cost optimization remains the top customer priority including vendor consolidation and operating model transformation enterprises are increasingly relying on technology to help improve their competitive advantage, transforming the way they operate," he said. He also noted that the BFSI segment had seen growth momentum through its performance in North American markets.
For Q1FY25, TCS reported a 9 percent YoY increase in consolidated net profit to Rs 12,040 crore. Revenue for the reporting period grew 5.4 percent on-year to Rs 62,613 crore.
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