* Sept quarter profit beats expectations with 44 percent
* Profit at 35.12 bln rupees vs forecast 33.34 bln
* Added 41 clients and 10,531 staff in the quarter
* Expects stable prices for fiscal year that ends March 2013
(Adds analysts' comment, CEO's outlook on prices)
By Aradhana Aravindan and Harichandan Arakali
MUMBAI, Oct 19 Tata Consultancy Services Ltd
(TCS), India's largest software services exporter,
posted a 44 p e rcent rise in quarterly profit h e lped by o v erseas
customers buying more of its outsourcing services to cut costs.
TCS, which provides information technology and back-office
services, is benefiting from a wave of cost-cutting by companies
around the world. It is part of India's $100 billion-a-year IT
services sector, which earns some three-quarters of its revenue
from exports to the United States and Europe.
"We have done very well, and we look optimistic," Chief
Executive N. Chandrasekaran told reporters on Friday.
He also noted the return of some discretionary spending,
which is typically for longer-term projects by clients and is an
indicator of the health of the industry.
Chandrasekaran said it would be difficult to push prices
higher in the current global economic environment but the
outlook for prices was stable at least for the rest of the
current fiscal year.
"A strong set of numbers from TCS. Better than expected
revenues, broadly stable pricing and broad based nature of
growth were the key highlights," said Kuldeep Koul, analyst at
ICICI Securities in Mumbai. "Margins were a tad light," he said,
but this was mostly due to an increase in work done overseas at
Fierce competition and rising operating costs have eroded
the bottom line of some Indian IT services firms, including
second-ranked Infosys Ltd.
Last week, Infosys reported weaker-than-expected margins for
the quarter ended Sept. 30. The former bellwether for India's IT
sector also disappointed investors hoping for a more robust
By contrast, smaller rival HCL Technologies Ltd on
Wednesday reported a 78 percent jump in quarterly profit after
securing large overseas contracts.
TCS's net profit for the three months ended September rose
to 35.12 billion rupees ($652 million) from 24.39 billion rupees
a year earlier, TCS said. Analysts had forecast a profit of
33.34 billion ru p ees, according to Thomson Reuters estimates.
"If you look at the markets, we've grown in every market,"
Chandrasekaran said. All lines of services grew, he said,
including the key financial services, which contributed 42.8
percent of the company's revenues in the September quarter.
He said there was a pick up in discretionary spending in
areas that included data analytics, solutions for helping
customers become more mobile, and cloud computing services.
The company does not provide detailed forecasts, but has
said it expects to beat the industry export revenue growth
forecast of 11-14 percent this fiscal year set by trade body
National Association of Software and Service Companies or
"We've said that we'll be ahead of NASSCOM, we'll be
delivering on that and we're on course," Chandrasekaran said.
TCS, part of the Tata Group industrial conglomerate, serves
customers including Citigroup Inc and BP Plc.
($1 = 53.840 rupees)
(Reporting by Aradhana Aravindan; Editing by Mark Potter and