TCS net income jumps 10.8% to Rs 8,131 cr

Largest software exporter TCS Tuesday reported a 10.8 percent rise in June quarter net at Rs 8,131 crore and said focus will be on maintaining double-digit revenue growth in the rest of the year.

The Tata Group cash machine reported a revenue growth of 11.4 percent to Rs 38,172 crore during the quarter, which on a constant currency basis clipped at 10.6 percent.

Bottomline has been hit a tad due to currency appreciation, and Tata Consultancy Services (TCS) said without quantifying it and termed currency depreciation as "intrinsic" to its business model and pointed out that future currency movements will determine if it can get the operating profit margin in the aspirational band of 26-28 percent.

Managing director and chief executive Rajesh Gopinathan said in FY18 revenue growth had slipped to below 10 percent, which recovered to double-digits in FY19 and said he is not looking at faster pace of topline growth.

"I am really not looking for acceleration, but looking for sustaining the double-digit growth level going forward," he told reporters announcing the numbers.

It can be recalled that the industry lobby Nasscom has stopped the practice of announcing yearly growth targets for the industry. The industry grew at 9 percent in FY19. TCS is the first company to announce the June quarter earnings.

He said the deal momentum is good and it was able to close the quarter with USD 5 billion worth of new deals, which include four clients in the USD 100 million-plus bracket.

From a profitability perspective, operating margin came in at 24.2 percent for the reporting quarter impacted by rupee gains and the higher wage bills.

Chief financial officer V Ramakrishnan, without offering a break-up, said there was a 2.4 percentage point impact from currency appreciation and the impact of the annual wage hikes granted to its 4.36 lakh employees, while operating efficiencies cushioned the overall impact at 0.88 percent compared to the preceding quarter. But he