TCS Q4 Results: Key Highlights & Analysis

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Overview of Tata Consultancy Services' Financial Year 2024 Performance

Financial Highlights

  • Total Contract Value (TCV): Achieved an all-time high of $42.7 billion for FY24, with a record $13.2 billion in Q4 alone.
  • Annual Revenue: Reported at ₹240,893 crore, marking a growth of 6.8% year-over-year (YoY). When adjusted for currency fluctuations, the growth rate stands at 3.4%.
  • Profitability:
    • Operating Margin: Maintained at 24.6%.
    • Net Margin: Stood firm at 19.3%.
    • Net Income: Increased by 10.5% YoY to ₹46,585 crore.

Geographic and Sector Growth

  • By Region:
    • United Kingdom: Experienced a significant growth of 10.1%.
    • Regional Markets: Witnessed a robust increase of 19.8%.
  • By Industry Vertical:
    • Energy, Resources, and Utilities: Led with a 12.6% YoY growth.
    • Manufacturing: Grew by 7.3% YoY
    • Life Sciences & Healthcare: Advanced by 4.8% YoY

Strategic Business Highlights from Q4, FY24

  • Service Prioritization: In a challenging macroeconomic environment, emphasis was on cost reduction, business agility, security enhancement, and resilience.
  • Key Deal Themes:
    • Focused on Cloud Migration and Modernization, Generative AI (GenAI), Enterprise Application Services, Identity & Access Management, Connected Devices, Digital Workplace Services, Network Services, and Vendor Consolidation.
  • Growth Leaders:
    • AI.Cloud, Enterprise Solutions, IoT & Digital Engineering, and Cyber Security.

Technological and Strategic Initiatives

  • AI.Cloud: Saw significant demand across various industries, with clients leveraging cloud and data platforms alongside GenAI to transform customer experiences and simplify tech landscapes.
  • Cyber Security: Recorded continued growth with traction in Identity and Access Management, Governance Risk Compliance, and Network Security.
  • Enterprise Solutions: Observed strong demand in Enterprise Application Services with substantial investments in digital core transformation using ERP systems.

Partnerships and Collaborations

  • Strategic Partnerships:
    • Partnered with Ramboll to manage their cloud and data centers, enhancing digital foundation and scalability.
    • Expanded a 15-year partnership with Aviva to transform its UK Life business using the TCS BaNCS™ platform.
    • Collaborated with Central Bank to modernize its core tech infrastructure and improve customer onboarding.
  • Innovative Initiatives:
    • Launched the TCS GoZero Hub with Macquarie University, focusing on research and innovations towards achieving net zero carbon emissions.

Future Outlook

  • Expansion and Innovation:
    • Continued focus on expanding service offerings in Cyber Security, IoT & Digital Engineering, and AI-based transformations.
    • Enhancing enterprise solutions through emerging technologies like Low Code No Code applications, and the integration of sustainability offerings.

Annual Highlights for FY 2023-24

MetricValue
Employee Headcount601,546
Diversity152 nationalities; 35.6% women
IT Services Attrition (LTM)12.5%
Talent Development Competencies Acquired5 million
Contextual Masters73,000
Free Cash Flow₹44,282 crore
Shareholder Payout₹46,223 crore (dividends and buyback)
Revenue₹61,237 crore (+3.5% YoY; CC: +2.2%)
Operating Margin26.0% (+150 bps YoY)
Net Margin20.3% (+100 bps YoY)
Net Income₹12,434 crore (+9.1% YoY)
Operating Cash Flow100.4% of Net Income

Quarterly Highlights for Q4 FY 2024

MetricValue
Revenue Growth+3.5% YoY (CC: +2.2%)
Growth LeadersIndia (+37.9%), UK (+6.2%), Manufacturing (+9.7%)
Operating Margin26.0%
Net Margin20.3%
Net Income₹12,434 crore

Client Metrics

Client BandCountChange YoY
$100 Million+62+2
$50 Million+139+6

Growth by Domain for FY 2023-24

IndustriesQ4 FY23 (%)Q4 FY24 (%)Y-o-Y CC Growth (%)FY 2023 (%)FY 2024 (%)Y-o-Y CC Growth (%)
BFSI32.931.3-3.233.332.0-1.0
Consumer Business16.015.7-0.316.015.81.8
Life Sciences & Healthcare10.910.91.710.810.94.8
Manufacturing8.18.89.78.28.67.3
Technology & Services8.98.2-5.69.08.5-2.3
Communication & Media7.16.6-5.57.26.8-2.6
Energy, Resources and Utilities5.45.67.35.25.612.6
Regional Markets & Others10.712.926.010.311.819.8
Total100.0100.02.2100.0100.03.4

Growth by Markets for FY 2023-24

GeographyQ4 FY23 (%)Q4 FY24 (%)Y-o-Y CC Growth (%)FY 2023 (%)FY 2024 (%)Y-o-Y CC Growth (%)
North America52.450.0-2.353.451.1-0.2
Latin America1.82.09.81.82.012.4
UK15.716.86.215.016.510.1
Continental Europe15.114.6-2.014.914.90.7
Asia Pacific8.07.85.28.07.84.5
India5.06.737.95.05.620.2
MEA2.02.110.71.92.114.4

About Company

Tata Consultancy Services (TCS) is a global leader in IT services, consulting, and business solutions, headquartered in Mumbai, India. As part of the prestigious Tata Group, TCS offers a wide array of services, including IT and business consulting, digital and technology solutions, and outsourcing services. Established in 1968, TCS has grown to become one of the most valuable IT services brands worldwide. The company operates in multiple industries such as banking, healthcare, manufacturing, and telecommunications, delivering technology-driven services to facilitate digital transformations for its clients. TCS is known for its deep industry expertise, commitment to innovation, and a rich heritage of corporate responsibility. With a workforce that spans across multiple countries, TCS is also noted for its diverse and inclusive work environment.

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