BENGALURU: The second wave of Covid has hit Tata Consultancy services’ (TCS) India business severely as the country’s largest IT services firm lost Rs 350 crore for the June quarter of the FY2022.
TCS, CEO, Rajesh Gopinathan said that the platform's business in India bore the brunt due to the viciousness of the Covid second wave, which was not anticipated. He added that business from the regional market saw a 14% de-growth across various client projects including digitization/ managing the Ministry of External Affairs passport sewa kendras, the company’s ion offering through which it has partnered with various state government-owned bodies as well as private businesses.
Both the drag in Indian markets as well as compensation hikes of the employees has led to a drop in the Consolidated net profit by 2.5% in constant currency terms for the Q1, FY21 at Rs 9,008 crore. from Rs 9,246 crore in the March quarter. This despite the core international markets stabilization with increased vaccination levels. TCS CEO said that markets like North America, Europe, UK, Australia have seen a 4-5% revenue growth in CC terms for the quarter.
The TCS CEO stated that the company is watchful of the increasing number of COVID cases in UK as well as hopeful that Indian businesses will rebound by the end of June month. Despite battling the health crisis as well as rising attrition levels, TCS onboarded 20,409 employees during the quarter with the total workforce crossing 5 lakh mark at 509,058.
The attrition rate increased by almost 1% q-oq to 8.6%, which according to Chief Human Resources Officer, Milind Lakkad is likely to rise in the forthcoming quarter. TCS reported margin contraction by 100 basis points sequentially at 25.5% due to salary hikes that were effective April 1, 2021. The company’s consolidated revenue from operations grew 3.9% sequentially at Rs 45,411 crore.