TCS in focus after declaring Q3 result

TCS in focus after declaring Q3 result

The net profit rose higher largely led by lower tax expenses but analysts' are hopeful for things to start improving in the next 2-3 quarter, suggest experts.

The Indian MNC earlier reported a net profit of United States dollars 796 million, thus registering a quarterly growth of 37.6 percent, and YoY growth of 45.4 percent. That compared with analysts' average estimate of 37.10 billion rupees, according to Thomson Reuters data. Revenue grew 3% to 177.94 billion rupees.

In his first media interaction after taking charge as Infosys CEO and MD on January 2, Parekh on Friday said that his immediate priorities would include connecting with employees and clients to build a "roadmap for future" that will be announced in April. "We were able to grow client relationships across revenue categories", said Pravin Rao, COO.

Infosys has concluded an Advance Pricing Agreement ("APA") with the U.S. Internal Revenue Service ("IRS"). The company has maintained its FY2017-18 sales growth outlook at 5.5-6.5 per cent in constant currency terms. Parekh was subsequently named the new CEO in December.

On the management changes, the company said that Rajesh K Murthy, President, has resigned citing personal reasons and his resignation will be effective January 31, it added. The string exits by senior executives over the past few years developed into a major hurdle for business stability at the Bengaluru-based software company. The key number to track would be digital services which would be a growth driver for Infosys and industry, he said.

Infosys' earnings came a day after larger rival Tata Consultancy Services reported a better-than-expected net profit on the back a surge in digital revenues.

Infosys shares have gained close to 15 per cent in the past three months, outperforming the BSE IT index, which has risen 12.5 per cent. India's biggest outsourcer TCS on Thursday announced its quarterly earnings, which were in line with market estimates.

However, Infosys' Chief Operating Officer U.B. Pravin Rao said increased adoption of digital solutions and new services has helped stabilize its price realization that has been under pressure for almost two years. "We are expecting improvement in the next two quarters". Shares of TCS lost 0.6%.

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