IT major Tata Consultancy Services (TCS) on Thursday declared again a whopping 700 per cent dividend (Rs 7 per share of Re 1 face value) for the third quarter of 2017-18. The company is expected to report profit for the quarter at Rs 3,609 crore, down 3.14 percent compared to Rs 3,726 crore in previous quarter, according to average of estimates of analysts polled by CNBC-TV18.
The company signed its first $50 million plus digital deal in this quarter, which is an important milestone in the mainstreaming of digital technologies for the company.
Sequentially, net profit and income grew 1.3 per cent from Rs 6,460 crore and Rs 31360 crore in the second quarter. Growth was led by Energy & Utilities (+8.5% Q-o-Q), Travel & Hospitality (+2.9% Q-o-Q) and Life Sciences & Healthcare (+2.5% Q-o-Q). The majority of these charges are expected to be recorded over the first three years of the agreement, with approximately United States dollars 100 million of transition and conversion charges reflected in the first half of 2018. TCS' digital revenue saw an increase of about 40% year-on-year and accounted for 22.1% of the company's revenues, the company said in a statement. "Through our technology transformation program our business will be faster, simpler and more focused on achieving a seamless customer experience". Core supplier services will transfer directly to TCS.
In dollar terms, the revenue stood at $4,787 million up by 9.1% yoy and 1% on qoq basis.
Gopinath said continental Europe, which grew 2.6% in CC, was poised to become the second largest market after the USA next year. The fast growing, high margin digital revenues today stand at 22.1 per cent accounting for more than United States dollars 4 billion in revenues, which is a growth of almost 40 per cent, year on year. "TCS was carefully selected because of their significant, ongoing investments in technology and their expertise in the insurance and annuity industry", said Mark Mullin, Transamerica President & Chief Executive Officer.
Posted 1.3% rise in net profit Quarter on quarter. "We expect demand to continue to remain soft. with companies seeing problems in clients and verticals".
It added that employees transitioning to TCS will be given the opportunity to remain in the same United States cities where they are now based.
Gopinathan added, "As lagging parts of our portfolio turn around, and areas of softness reduce, we are well placed for stronger growth".
At 1:43 pm, shares in TCS were trading 0.80 per cent lower at Rs 2,766 on the BSE, whose benchmark Sensex index was down 5 points at 34,498.