Tata Consultancy Services (TCS), India’s largest multinational business group, has over 390,000 of the world’s best-trained consultants across 46 countries. The company recently announced its third quarterly result (Q3), wherein, Rajesh Gopinathan informed “We signed our first $50 million-plus deal in Digital this quarter crossing an important milestone in the mainstreaming of Digital technologies”.
Yash Ved of NewsBarons provides you the highlights of the interaction with Rajesh Gopinathan, CEO and MD, TCS.
NB: How was the quarter as a whole?
Rajesh: We have been maintaining our margins and our cash conversion has been impressive. We wrapped 2017 with a strong performance in the December quarter, marked by the signing of industry-defining deals, robust client metrics and broad-based demand across industry verticals.
Our focus has been on talent management, skill building and on digital side.
The investments we have been making over the last few years in Research and Innovation and in building intellectual property are giving us a distinct edge in the market in winning such large transformational programs.
NB: Please inform on business growth?
Rajesh: Progressive organizations looking to take advantage of new opportunities in the Business 4.0 era are ramping up their Digital investments and TCS has emerged as their preferred transformational partner.
Apart from other key client acquisitions and partnership extensions, we have signed our first $50Mn+ deal in Digital this quarter crossing an important milestone in the mainstreaming of Digital technologies. Other two important wins for the quarter are the tie-ups with a large European and an Australian Bank.
NB: Brief us about the Segment Highlights for the quarter?
Rajesh: The industry verticals grew above company average in Q3. The Retail and CPG vertical showed a strong turn around, growing 6.4% Q-o-Q. 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). On a year on year basis, all industry verticals – with the exception of BFSI and Retail – grew above 9.5%, with four verticals growing in double digits Y-o-Y.
NB: Brief us about your international operations?
Rajesh: Europe has done better growth this quarter after US. We expect Europe will deliver better growth this year.
The growth was led by Latin America (+5% Q-o-Q), Continental Europe (+2.6% Q-o-Q) and North America (+1.5% QoQ). On a Y-o-Y basis, Continental Europe (+22.3%), UK (+8.2%) and India (+4.1%) performed very well. North America grew 2.8%.
NB: What has been the employee addition for the quarter and attrition rate?
Rajesh: The total employee strength at the end of Q3 stood at 390,880 on a consolidated basis, with gross addition of 12,534 employees and net addition of 1,667 employees during the quarter.
The Localization initiatives continue to progress well with 2,929 employees recruited outside India in Q3 bringing the total to 9,908 in FY 18, year to date.
The IT Services attrition rate (LTM) fell by 0.2% in Q3 to 11.1% while the total attrition rate (including BPS) fell to 11.9%.