BENGALURU: The Covid-19 pandemic is expected to impact businesses of India’s largest IT service
provider, Tata Consultancy Services (TCS), in the same proportion as that of the global financial crisis of 2008, said the company’s chief executive officer and managing director Rajesh Gopinathan on Thursday.
The current countrywide lockdown will impact TCS’ businesses across all verticals in the first two quarters of FY21, and the revenues are likely to bounce back to normal in Q3FY21, he said.
“We expect to be in the same position. However, TCS will bring onboard, 40,000 trainees from across various academic institutions of the country from June onwards, even though the company has decided against providing any salary increments to nearly 4 lakh employees this year,” Gopinathan said.
There will be no retrenchments as there is no shortage on the demand side, and the promotions will be performance-based, the IT major clarified. Nearly 90 per cent of TCS employees have adopted the ‘work from home’ model during the ongoing lockdown, and going forward, only 25 per cent of employees will work from office premises, it said.
The Mumbai-based IT behemoth on Thursday reported a marginal decline in profit by 0.85 per cent at Rs 8,049 crore on a quarter-on-quarter basis. The total contract value for Q4FY20 stood at $8.9 billion. The company board also recommended a dividend of Rs 6. The consolidated revenue grew by 5 per cent at Rs 39,946 crore year-on-year in Q4. TCS said that its life sciences and communications verticals grew strongly at 16.2 per cent and 9.3 per cent, whereas the BFSI vertical was hit due to the extreme volatility in US markets.
“The pandemic completely reversed the positive momentum that we had started seeing in some of our biggest verticals in the first half of the quarter. On the positive side, we had very strong deal closures during the quarter. In fact, our order book this quarter is the largest ever, from the time we started
reporting the metric. Organisations across the world are realising the need for operational and systems resilience,” Gopinathan said.