Particulars (In Rs. Cr.) – Consolidated Q4FY21 Q3FY21 Q4FY20 QoQ % YoY% FY21 FY20 YoY %
Revenue from Operations 43,705 42,015 39,946 4.0% 9.4% 1,64,177 1,56,949 4.6%
Other Income 931 691 738 34.7% 26.2% 3,134 4,592 -31.8%
Total Income 44636 42706 40684 4.5% 9.7% 167311 161541 3.6%
Employee Benefit Expenses 23625 23,431 22051 0.8% 7.1% 91,814 85,952 6.8%
Employee Benefit Exp. as % of Rev. 54.06% 55.77% 55.20% (171)bps (115)bps 55.92% 54.76% 116 bps
EBIT 11734 11184 10025 4.9% 17.0% 42481 38580 10.1%
EBIT Margin 26.85% 26.62% 25.10% 23 bps 175 bps 25.88% 24.58% 129 bps
Profit After Tax 9282 8727 8,093 6.4% 14.7% 32,562 32,447 0.4%
PATM (%) 20.79% 20.44% 19.89% 36 bps 90 bps 19.46% 20.09% ( 62) bps
EPS (in Rs.) 24.95 23.19 21.45 7.6% 16.3% 86.71 86.19 0.6%
Segment Revenue – Consolidated Q4FY21 Q3FY21 Q4FY20 QoQ % YoY% FY21 FY20 YoY%
BFSI 17,559 16,655 15,207 5.4% 15.5% 65,634 61,095 7.4%
As % of Revenue 40.2% 39.6% 38.1% 54 bps 211 bps 40.0% 38.9% 105 bps
Manufacturing 4,213 4,027 4,217 4.6% -0.09% 15,950 16,468 -3.1%
As % of Revenue 9.6% 9.6% 10.6% 5 bps (92) bps 9.7% 10.5% (77)bps
Retail and-Consumer Business 6,778 6,546 6,682 3.5% 1.4% 25,589 26,280 -2.6%
As % of Revenue 15.5% 15.6% 16.7% (7)bps (122) bps 15.6% 16.7% (115) bps
Communication, Media and Tech. 7,042 6,980 6,751 0.9% 4.3% 27,077 25,978 4.2%
As % of Revenue 16.1% 16.6% 16.9% (50) bps (79) bps 16.5% 16.6% (5) bps
Others 8,113 7,807 7,089 3.9% 14.4% 29,927 27,128 10.3%
As % of Revenue 18.6% 18.6% 17.7% (2) bps 82 bps 18.2% 17.3% 95 bps

Result Highlights:

  • TCS Consolidated Revenue rose 4% QoQ and 9.4% YoY to Rs 43,705 crore higher than the estimated of Rs 43,551 crore. Revenue growth comes on the back of deal wins of $9.2 billion during the quarter the highest Ever deal wins in a Quarter.

  • Revenue in dollar term rose 5% to $5,989 million.

  • Revenue in FY21 rose 4.6% to Rs. 1,64,177 Crore while PAT grew 0.4% to Rs. 32,447 Crore.

  • EBIT margin of TCS expanded by 23 bps on sequential basis in Q4FY21 to 26.85% vs 26.62% in Q3FY21 however margins are little below the street estimates of 27%

  • Net profit rose 14.7% YoY to Rs 9282 crore (below the estimates) for the March quarter compared with Rs 8,093 crore in the same quarter last year.

  • PAT margins of the company fell 62 bps in FY21 to 19.46% from 20% in FY20.

  • BFSI Segments Contribution to the total revenue of the company rose to 40% in FY21 from 38.9% in FY20.

  • On a sequential basis, Growth was led by BFSI (5.40%), retail and CPG (3.5%), Manufacturing (4.6%) and Life sciences and healthcare. On a full year basis, Life Sciences and Healthcare, BFSI and Technology & Services showed growth while the rest continue to be below prior year levels.
  • All markets showed good sequential growth, with North America growing 3.9%, UK +3.4%, Middle East & Africa (4.2%). On a full year basis, with the exception of Continental Europe which grew +5.5%, all other markets continue to be in negative territory compared to the prior year.

  • Cash Flows from Operating Activities rose 7.4% in FY21 to Rs. 40975 Crore while Free Cash Flow increased to 17.5% YoY to Rs. 37968 Crore.

  • IT Services attrition rate dips to a new all-time low at 7.2% from 7.6% in Q3FY21.

  • The company approved Final dividend of Rs 15 per share.

Management commentary:

  • Commenting on the Q4 performance, Rajesh Gopinathan, Chief Executive Officer and Managing Director, said: “Our investments over the last decade in building newer capabilities, and in research and innovation, position us well for the multi-year technology services opportunity ahead. While we continue to dominate in our traditional areas of strength, we are making good progress in gaining share in the growth and transformation opportunity. Our focus going into FY22 will be to engage with clients in their growth agenda, propelled by innovation and leverage of collective knowledge.”

  • All-round Q4 margins are a validation of our strong belief that it is possible to win mega-deals, post industry-leading growth, and continue to invest in our people and in newer capabilities, and still deliver industry-leading profitability. All the investments that we have been making over the years position us strongly to expand our Footprint in the large growth and transformation opportunity.

  • On Track to achieve double digit growth in FY22.


Tata Consultancy Services (TCS) managed to beat Street expectations on revenue front in the quarter ended March 2021. Total deals showed strong growth during the quarter stood at $9.5 billion compared with $6.8 billion in the December quarter and $8.6 billion in the September quarter. TCS has reported strong growth in Continental Europe (+8.5% QOQ) and North America (+3.9% QOQ). Strong order book and robust deal pipeline will be the strong growth drivers for next 3 years with the company is on track for double-digit growth for FY22 and will benefit from 3 key spending themes: cloud transformation, customer experience, & core modernization. TCS services attrition rate hit an all-time low at 7.2 percent LTM. Adding investments in people, progressive HR policies and an empowering culture have made TCS the global industry benchmark in talent retention. At the CMP of Rs. 3104, TCS is trading at PE multiple of 35.8x.  Valuing the company at 33x FY21E EPS, we recommend buy on TCS at CMP of Rs. 3104 for the Target Price of Rs.3400.

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