* Profit rise to 17.97 bln rupees beats 16.04 bln estimate
* Sees healthy deal pipeline; prices likely to remain flat
* Added 32 new clients in Dec quarter
* Shares end 1.3 pct higher; had more than tripled in 2009
(Adds details, management comments)
By Pratish Narayanan
MUMBAI, Jan 15 Tata Consultancy Services
(TCS.BO) glided past street estimates with a 33 percent rise in
quarterly profit as demand for outsourcing surged and prices
stabilised, fuelling hopes of recovery in the showpiece sector.
India's top software services exporter is seeing increased
demand for services from all its business segments and the
company has a healthy deal pipeline, Chief Executive N.
Chandrasekaran told reporters on Friday.
"We are seeing a broader recovery happening," he said,
adding the deal flows were coming back to the pre-Lehman crisis
levels as western companies focus on reducing operational costs
and boosting efficiency.
However, pricing is likely to remain flat in the near-term,
Chandrasekaran said. "It will take at least a few more quarters
for pricing power to return."
A global economy on the mend, recent deal wins, and stable
prices have brightened the outlook for export-driven Indian IT
companies such as Tata Consultancy and rival Infosys
Technologies (INFY.BO), after the world recession hit the
Infosys, a trendsetter for the $60 billion Indian
outsourcing sector, raised forecasts on Tuesday as big financial
services clients boost orders in an improving global economy.
The rupee, which rallied to a 15-month high last week,
surging wages and intense competition from global firms such as
IBM (IBM.N), Accenture (ACN.N) and Hewlett-Packard (HPQ.N) are
seen as key risks for the sector.
The software services sector gets more than half its revenue
from the United States but companies are furiously expanding in
Asia Pacific, Latin America and the Middle East.
Ahead of the announcement, shares in Tata Consultancy, which
provides services such as consulting, system integration and
back-office outsourcing, ended up 1.3 percent at 791.80 rupees
in a Mumbai market .BSESN down 0.2 percent.
The firm, part of the Tata Group that spans commodities
autos and services businesses, said net profit in
October-December rose to 17.97 billion rupees ($392 million)
from 13.52 billion rupees reported a year ago under U.S.
A Reuters poll of 15 brokerages forecast a net profit of
16.04 billion rupees for the firm which counts Citigroup (C.N),
General Electric (GE.N), General Motors, Lloyds TSB (LLOY.L),
Ferrari and American International Group among its clients.
Tata Consultancy's quarterly profit under the Indian
accounting standards was 18.24 billion rupees.
Revenue increased 5 percent from a year ago period to 76.50
billion rupees, as it added 32 new customers including a $100
million deal spread over five years from a manufacturing
company, taking the total tally to 917.
Shares in Tata Consultancy, which the market values at $34
billion, more than tripled in 2009, compared with a surge of 81
percent in the main market. ($1=45.8 rupees)
(Writing by Sumeet Chatterjee; Editing by David Cowell)