TCS crosses Rs 1,019 crore
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TCS crosses Rs 1,019 crore

By agencies   |   Tuesday, 17 October 2006, 07:00 Hrs
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Mumbai: IndiaÂ’s software major, Tata Consultancy Services (TCS), today has become the first Indian IT company to cross Rs 1,019 crore net profit mark in a quarter. Its revenues beat market expectations, growing 42.43 percent to Rs 4,495 crore. TCS announced a dividend of Rs 3 a share.

The company has hit a high of Rs 1,148 in anticipation of the results during trading hours on the BSE on Monday. The scrip closed at Rs 1130.45, up 2.33 percent from its previous level of Rs 1104.75. With its performance in the second quarter, TCS could cross $4 billion in revenues in the current fiscal.

“We look forward to a great year. We are likely to hit the boundary at $4 billion,” TCS CEO and MD S Ramadorai said. This is the closest ever the company has come to giving a guidance since it does not give guidance over future financial performance. The company ended FY06 a whisker shy of $3 billion. During the quarter, the company’s margins improved 200 basis points to 28 percent, fuelled by higher billing rates, a lower rupee and phenomenal offshore leverage, TCS CFO S Mahalingam said.

New contracts are being signed at 5-10 percent higher rates, while the price improvement on existing contracts coming up for renewal is about 1 percent. Offshore as a percentage of international business was 41 percent, compared to 38 percent in the last quarter.

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