InvestorQ : How were the TCS quarterly results for the Sep-21 quarter and how do you see the stock from here?
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How were the TCS quarterly results for the Sep-21 quarter and how do you see the stock from here?

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Deepa Salunkhe answered.
1 month ago
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For the quarter ended Sep-21, TCS reported 16.77% growth in sales at Rs.46,867 crore. The sales also grew on a sequential basis over the June quarter by 3.21%. All the principal product verticals of TCS witnessed smart growth including BFSI, manufacturing, retail, CMT and life sciences. The icing on the cake was that the North American revenues grew 17.4% in constant currency terms as TCS added 5 premium clients in the above $100 million group.

Operating margins were steady at 25.6%, but slightly lower than the Sep-20 quarter. In terms of specific verticals that triggered this solid OPMs, manufacturing grew by 21.7%, life sciences by 19%, retail at 18.4%, BFSI at 17% and communication and media grew 15.6%. IF you look at geographical spread, apart from North America leading the way, UK grew at 15.6% and continental Europe at 13.5%. India was a star among EMs growing at 20.6%.

One of the big advantages for TCS was that the bottom line has also growth at a robust rate like its top line. For the Sep-21 quarter, net profits grew by 28.64% on yoy basis at Rs.9,653 crore but more importantly it was up 6.9% on a sequential basis. Operating margins have stabilized at above 25% and while the stock may be fairly priced, it is likely to continue to widen its gap with Infosys in gradual phases over time.

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