KEY TAKEAWAY

• Highest Ever Order Book TCV: $11.3 billion in Q4; $34.6 billion in FY22

• Highest Ever Incremental Revenue in a Year: $3.53 billion

• Q4 Revenue $6.69 billion, +11.8% (CC: +14.3%)

• FY 22 Revenue $25.70 billion, +15.9% (CC: +15.4%)

• Industry-leading Profitability: Operating Margin 25.3%, Net Margin 20% in FY 22

• FY 22 Net Income at $5.13 billion, +13.9%* YoY

• Client metrics: Added 10 clients in the $100 Mn+ bucket, 19 in the $50

• Mn+bucket, 40 in the $20 Mn+ bucket and 52 in the $10Mn+ bucket 

India’s largest software company, Tata Consultancy Services (TCS) on Monday declared a Steller set of numbers; contrary to global market notion that IT Industry growth trajectory will hit this Financial year. TCS closed financial year 2022 with a record revenue, crossing for the first time $ 25 billion annual revenue of Rs 1,91,754 crore, YoY 16.8 percent. It maintained its Leadership position over its peers by a big margin with consistent over 15 percentage revenue growth, diversify workforce (153 nationalities), women over 35% of workforce and with the addition of 103,546 new employees to reach headcount 5,92,195 which grew by 21.19 % YoY. It closed the financial year with an all-time high order book $ 34.6 billion in FY22.

Earnings and Cash Flow

TCS annual profit grew by 14.8 percent to Rs 38,327 crore. For the fourth quarter ended March 31, 2022 it reported a net profit at Rs 9,926 crore grew by 7.3 precent YoY. At the operating level, its performance was little muted EBITDA stood at Rs 12,628 crore in Q4 FY22 over Rs 12,237 crores in the last quarter. EBITDA margin has come down to 24.96 percent in Q4 FY22 as compared to 25.03 percent in the last quarter.

TCS maintained a health Free Cash Flow: $ 5.257 billion. It also declared that $ 4.179 billion of cash returned to shareholders through buybacks and dividends.

Rajesh Gopinathan, CEO and MD, said while presenting the company’s result, "We are closing FY 22 on a strong note, with mid-teen growth and adding the maximum incremental revenue ever. Increasing participation in our customers’ growth and transformation journeys, and an all-time high order book provide a strong and sustainable foundation for continued growth ahead."

Geographical coverage

TCS growth was broad base spread across the region, North America $ 3.45 billion grew (up 18.7 percent), followed the UK $ 1.04 billion grew (up 13 percent) and Continental Europe $ 1.04 billion (up 10.1 percent). Similar trend witness in other markets; Among emerging markets, Latin America grew (up 20.6 percent), the Middle East & Africa grew (up 7.3 percent), India grew (up 7 percent) and the Asia Pacific grew (up 5.5 percent).

Vertical coverage

BFSI vertical maintained its dominance in TCS growth, $ 2.14 billion YoY grew 12.9 percent; Retail and CPG vertical $ 1.03 billion grew YoY 22 percent; Manufacturing vertical $ 0.67 billion grew YoY 19 percent; Communications & Media grew YoY 18.7 percent; Technology and Services grew 18 percent and Life Science and healthcare grew YoY 16.4 percent. Demand continued to be strong during the quarter as well as the full year across all markets, industries, and services, with growth led by Cloud, Cyber Security, Enterprise Application Services and IoT & Digital.

IPR and Patents

TCS maintained its edge over its competitors through its research, products, IPR and Patents. The company has applied for 6,583 patents and has been granted 2,287 patents as of March 31, 2022. In the current year, company filed for 704 patents and was granted 437.

N Ganapathy Subramaniam, COO and Executive Director, commented: “It is immensely satisfying to close the year with robust, broad-based growth, industry-leading margins and the highest ever order book. During the year, we took on technologically challenging, industry-first transformational programs and brought to bear the full power of TCS’ capabilities and that of our partner ecosystem, to successfully deliver market-changing outcomes."

Samir Seksaria, CFO, said: “While continuing to make all the investments needed to support our growth aspirations, we managed the headwinds this year to deliver an industry-leading operating margin yet again. The successful completion of our fourth buyback in five years is another milestone in our shareholder-friendly approach to capital allocation.”

TCS also announced a final dividend of Rs 22 per equity share of Rs 1 each, which is subject to the approval of the shareholders of the company.