India’s largest software exporter TCS on Thursday said its net profit slipped 3.6 per cent to Rs 6,531 crore in three months to December due to margin compression and softness in the banking and financial services sector, which is its largest revenue segment.
The Tata Group company had reported a net profit of Rs 6,778 crore in the December 2016 quarter under the Ind-AS accounting. In July-September 2017, its net profit stood at Rs 6,446 crore. Revenue from the banking sector, which contributes a third of TCS’ overall turnover that grew at a paltry 3.9 per cent to Rs 30,904 crore, declined by 1.5 per cent from the September quarter, its managing director and CEO Rajesh Gopinathan informed reporters.
“Banking continues to be an area where we are on a wait-and-watch mode. I would still think we are a couple of periods away from a recovery in this,” he said without quantifying growth level at which it will call it a recovery.
North America, its largest market by revenue, also delivered sluggish growth at 2.8 per cent, Gopinathan said and attributed to many factors such as banking customers not investing enough in technology upgrade.