For the three months to the end of March 2007, TCS reported net profit of INR 11.7bn ($269.8m), up from INR 8.0bn ($183.1m) in the same period the previous year, on revenue of INR 51.5bn ($1.2bn), up 38.2% on the fourth quarter of fiscal 2006.
For the second quarter in a row, TCS’s sales topped $1bn. However, the company’s sales growth rate was down on the previous three months of the year, when revenue increased by 40.8% to $1.1bn. Last week, TCS’ local rival Infosys announced fourth-quarter sales growth of 46%.
For the full-year period, TCS reported net profit of INR 41.3bn ($950.4m), up 43.3% in the previous year, on revenue that grew 40.7% to INR 186.3bn ($4.3bn). The company said it now derives revenue of over $2bn from North America and has crossed the $1bn mark in Europe.
TCS’s attrition rate rose slightly to 11.3% from 10.8% in the third quarter of the year, but it remains the lowest of the Indian offshore outsourcing vendors. There was a net addition of 5,827 employees in the fourth quarter, taking the company’s total headcount to 89,419. Of this total, 9.6% are non-Indian nationals.
AS Lakshminarayanan, vice president and country manager for TCS in the UK and Ireland, told Computer Business Review that a number of factors contribute to the company’s comparatively low attrition rates. He said these include competitive salaries and benefits, the strength of the Tata brand, both in India and elsewhere, the company’s commitment to corporate social responsibility projects and a value system within the organization that motivates workers to stay on and build a career.
Despite continuing to produce stellar financial results, Lakshminarayanan said TCS still has some way to go before it achieves its full potential. Our market share is still very small globally, he said. We can’t say we’ve achieved what is possible until we get 5%, 6%, or 8% of the total market. We have only scratched the surface of what is possible.
