Sunday, January 23, 2011

TCS and HCL leap forward, Infosys and Wipro struggles in Q3

Tata Consultancy Services and HCL Technologies have marched ahead of Infosys and Wipro by delivering all-round growth in a traditionally weak third quarter.

While HCL registered the highest growth on net profits and overall turnover, it continues to pick up work at the lowest margins. On the other hand, TCS results beat market expectations on almost all parameters while Infosys and Wipro's were ‘below par', industry watchers say.

“TCS has been an outperformer not only in the quarter but also in the calendar gone by. It is easier for a smaller company to grow from a smaller base, but a growth of 30 per cent on a quarterly revenue run rate of over $2 billion is certainly impressive,” Mr Jimit Arora, Everest Group's research director, said.

On the other hand, the HCL management has realised that it needs to improve its operating margins which were 16.3 per cent at the end of the quarter. Its CFO, Mr Anil Chanana, said it would improve operating margin by at least two percentage points by the time it declares its June 2010 quarter results. This will be achieved through higher employee utilisation and a better deal pipeline.

(from Business Line)

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