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Tata has strong quarter

Mumbai: Tata Consultancy Services, TCS, saw strong growth in its second quarter, ended September 30, 2011.

Operating profit was up 21% to $684million, on revenues up 26% to $2.52billion. For the first half year, operating profit was up 25% to $1.316 billion on revenues up 29% to $4.93 billion.

Business highlights for the quarter include:

  • $100-million+ customers up 2 to 12; reflects continued traction for full services strategy
  • Gross Addition of 20,349 Employees (Net Addition of 12,580 employees)
  • High Utilisation rates maintained at 83.1% (excluding trainees)
  • 35 New Clients added; 1010 active clients

During Q2, TCS says it witnessed significant growth across all major markets with North America clocking 9 per cent, UK growing by over 10 and continental Europe up over 9 per cent. Among new growth markets APAC, MEA and Latin America grew by 10, 9 and 3 per cent respectively and revenues from India were down 4 per cent.

There was balanced growth across industries in all markets. Among industry verticals, growth was led by Energy & Utilities, which grew by 20 per cent, followed by Retail, Travel & Transportation, Manufacturing and BFSI which grew at 12, 10, 10, 9 per cent.

All service lines grew during the quarter with Global Consulting growing at 27% while Asset-based solutions grew 20%, followed by Engineering, Assurance and Infrastructure Services at 14, 12, 9 per cent respectively.

Chief Executive Officer and Managing Director, N Chandrasekaran said: "Our domain-rich solutions and disciplined execution helped us capture business demand across major markets and deliver stellar growth in international revenues. We see strong momentum for our full services strategy from customers who are looking for agility and growth.

"We have created a nimble organization on the ground to stay close and stay relevant to our customers as there are ambiguities in the external environment in the short term."

S. Mahalingam, Chief Financial Officer and Executive Director, said: We continue to make the necessary investments to support our future business growth in different markets as we remain in expansion mode. However, we are also working to optimize our cost structure and keeping a close watch on economic signals."

He added: "Given the breadth of our global operations across 45 countries, the recent unprecedented volatility in the foreign currency markets is fresh cause for concern."

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