Indian market gains on Thursday, TCS reports net profit of $1 billion for Q3

Key stocks that were gainers on BSE Sensex were  NTPC, Infosys, L&T, Cipla and Wipro while Lupin, HUL, Coal India, Dr Reddy's Labs and ITC were losers.

According to media reports, IT stocks were overall upbeat hoping that US President-elect Donald Trump may not impose strict visa rules but Pharma stocks on the other hand took a hit on Trump's comment that drug making companies were "getting away with murder" considering what they charge the government for medicines and he said that is going to change.

Tata Consultancy Services, the leading IT services, consulting and business solutions firm reported its consolidated financial results according to IFRS in dollar terms for the quarter ended December 31, 2016 on Thursday.

According to TCS, quarterly net profit was $1 billion, revenue at $4,387 million was up 5.8% Y-o-Y and digital revenues at 16.8% was up 30.2% Y-o-Y.

Commenting on the Q3 performance, N Chandrasekaran, CEO and MD, TCS, said, “The resilience of our business model and strength of our operating strategy has been brought to the fore by our performance in Q3, traditionally a quarter of weak demand. Our strengths in Digital, Platforms and Cloud as well as our deep knowledge of the customers’ domain are driving our ability to play a strategic role and make a holistic impact on the business.”

“To support and sustain our Digital business that is growing at 30% on an annual basis, we continue to build new capabilities in Digital technologies, empower employees to enhance agility in the workplace and invest more to develop IP-based platforms and products. Some of these products and platforms are maturing with greater customer adoption while others continue to be incubated in our Innovation labs. As digital adoption increases in 2017, we are well prepared to lead this change,” said Chandrasekaran

Rajesh Gopinathan, Chief Financial Officer, TCS, said,  “We have shown great discipline and control at all levels to deliver another credible quarter. Alongside a good growth performance, we have been able to keep profitability stable in our desired range and deliver over $1 billion in free cash flow during the quarter.”

During Q3, the company reported that growth was led by Energy & Utilities (up 5.8% sequentially), Hi-Tech (up 2.6% sequentially), BFSI (up 2.1% sequentially), Manufacturing (up 2.1% sequentially) and Retail (up 1.9% sequentially) in constant currency.

From a geography perspective, emerging markets like Latin America and India clocked double digit growth of 12.5% and 10.3% sequentially respectively while North America grew 2.2% sequentially and UK grew 1.7% sequentially.

From a services perspective, strength in growing segments like Platforms, Cloud and Internet of Things is evident from the growth in Asset Leveraged Solutions (up 21% sequentially), Infrastructure services (up 9.5% sequentially) and Engineering and Industrial Services  (up 3.1% sequentially).