TCS Stock Posts Strong Earnings After Q2 Results

IT giant, Tata Consultancy Services (TCS) recorded strong profit booking in Monday’s trading session after the company announced its financial performance for the quarter ending September 2021 (TCS). TCS stock plunged nearly 7% with an intraday low of Rs 3,660 per coin on Dalal Street during the early bells. TCS weighed on the sector.

Investors took a bearish stance after TCS’s revenue and margins fell short of analysts’ estimates in the quarter under review. Additionally, investors took profits as TCS stock was at all-time highs since last week.

At around 10:05 a.m., TCS was trading at Rs3723 per coin in a dive of Rs212.30 or 5.4% on Sensex. At the current level, the market valuation of the company is Rs13,75,381.28cr.

With the low of the day, TCS wiped out around Rs1 lakh cr of market capitalization within minutes of today’s opening bell.

Last week on Friday, the market capitalization of TCS was Rs14,55,687.69cr on the closing price on Sensex.

The company recorded revenue of Rs46,867cr in Q2FY22, up 16.8% year-on-year. Revenue growth at constant exchange rates was over 15.5%. Meanwhile, TCS recorded a net profit of Rs9,624cr in the quarter under review, up 14.1% year-on-year. The net margin was 20.5%.

In its audit report, TCS said all verticals posted strong double-digit year-on-year growth. Growth was led by manufacturing (+21.7%), followed by life sciences and healthcare (+19%), retail and consumer goods (+18.4%) and the BFSI (+17%). Communications & Media (+15.6%) and Technologies & Services (+14.8%) experienced an acceleration in their growth.

In terms of geographic basis, TCS said all major markets posted strong growth, with growth led by North America (+17.4%). The UK increased (+15.6%) and Continental Europe increased (+13.5%). Among emerging markets, growth was led by India (+20.1%), followed by Latin America (+15.2%), the Middle East and Africa (+13.8 %) and Asia-Pacific (+7.6%).

The company added 19,690 employees on a net basis. This brought the total workforce to 528,748 in the company at the end of September this year. The company’s IT services (LTM) attrition rate was 11.9%, the lowest in the industry.