TCS says IT cos not yet out of woods, Q2 net profit up 9%

: The country’s largest software exporter TCS on Wednesday reported an 8.7 per cent increase in its September quarter net profit to Rs 11,342 crore, but made it clear that the headwinds for the IT sector continue amid a sluggish economic climate.

The Tata Group company also announced a Rs 17,000-crore share buyback on top of committing a nearly Rs 3,300-crore dividend payout.

Its revenue increased 7.9 per cent in the September quarter to Rs 59,692 crore but was up only marginally compared to Rs 59,381 crore in the preceding June quarter.

“Yes, there is uncertainty because of which clients are focused more on optimisation, which results in the older projects getting optimised or some of them getting passed or reprioritised, resulting in muted or moderated revenue growth,” its chief executive and managing director K Krithivasan sais. The company’s mainstay of banking, financial services and insurance reported a marginal dip in revenue, and so did communication and media at negative 2.1 per cent. Among the geographies, the United Kingdom led by growing at double digits, but the biggest market of North America grew by just 0.1 per cent.

Meanwhile, even as it faces choppy waters on the revenue expansion front, the company reported new deal signings of USD 11.2 billion, the third straight quarter of the number being over USD 10 billion.