Shares of Tata Consultancy Services on Friday gained nearly 1 per cent in early trade after the company reported a 28.5 per cent jump in June quarter net profit.

The stock started the trade in the green and gained 0.73 per cent to ₹3,281 on the BSE. As the trade progressed, it witnessed volatile trading and hit a low of ₹3,211.85.

At NSE, the scrip gained 0.72 per cent to ₹3,282.

The company’s quarterly results were announced post market hours on Thursday.

The country's largest software firm TCS on Thursday reported a 28.5 per cent jump in June quarter net profit at ₹9,008 crore and called out the domestic business as a drag, which restricted its overall growth because of the second wave of Covid-19.

Contrasting trends

The company, a cash cow for the over $100 billion Tata group, said the June quarter results were a tale of two contrasting trends of healthy growth in core markets like the US and segments like banking, and the domestic business being a drag.

It, however, added that even in India, which has traditionally been an insignificant market for the firm, activity is showing some signs of improvement, and exuded confidence of meeting the overall double-digit revenue growth estimate for FY22 announced earlier.

The second wave dented revenues by as much as ₹350 crore as businesses like passport issuances and tests-focused TCS iON remained impacted, its chief executive and managing director Rajesh Gopinathan told reporters.

Reacting to the results, analysts at domestic brokerage Reliance Securities said the revenue underperformance was a one-off and welcomed the significant deal wins.

It added that TCS is set to be a key beneficiary of the uptick in technology spends over the medium term.

Published on July 9, 2021