Analyzing TCS' Fiscal Year 2023-24: How the Company Performed Amidst Global Macro Uncertainty

The Tata Consultancy Services (TCS) ended its financial year 2023-24 on a high note as indicated by the consolidated financial results for the quarter and the full year ending March 31, 2024. The company recorded numerous accomplishments across various parameters demonstrating resilience and strategic execution amidst global macroeconomic uncertainties.

Financial Highlights

• TCS registered its highest ever order book Total Contract Value (TCV) of $42.7 bn in FY24 with significant TCV of $13.2 bn for Q4.
• Full-year revenue reached $29.08bn, recording a YoY growth of 4.1% (+3.4% CC) propelled by UK (+10.1%) and regional markets (+19.8%).
• On a Vertical basis, there were growth drivers such as Energy, Resources & Utilities (ERU) at +12.6%, Manufacturing at +7.3% and Life Sciences & Healthcare at +4.8%.
• Operating margin remained strong at 24.6%, net margin was at 19.3%, whereas net income surged to $5.62bn representing a YoY increase of 7.8%.
• Operational Highlights

Operational Highlights

• There were 62 clients in the $100mn+ band, up by two from last year and 139 clients in the $50 mn+ band indicating an increase by six from the preceding period.
• The staff comprised of people from different countries numbering to approximately over six hundred thousand and one with women making up about thirty five point six percent.
• Additionally, TCS endured attrition rate of IT services that amounted to twelve point five per cent over the last twelve months.

Segment Performance

• Across industries, TCS experienced growth in Energy, Resources, and Utilities (+7.3%), Manufacturing (+9.7%), and Regional Markets & Others (+19.8%) in Q4 FY24.
• Geographically, the company observed growth in the UK (+6.2%), India (+37.9%), and Latin America (+9.8%) in Q4 FY24.

Engagement with Clients and Services

• TCS observed that clients prioritized projects centered around cost reduction, improving business agility, and strengthening security posture amidst a tough macro environment.
• Cloud migration, modernization, machine learning, enterprise application services, identity and access management, and digital workplace services were the main areas of success in closing deals.
• With an emphasis on its proficiency in Application Transformation, Consulting, AI & Analytics, Cloud, IoT & Digital Engineering, among other areas, TCS was able to retain 80% of the top positions in all major service categories.

Human Resources, Innovation, and Research

At the end of March 2024, TCS had 8,040 pending patent applications and 3,919 granted, demonstrating its dedication to research and innovation. The company's multicultural staff participated in ongoing education, gaining 51 million learning hours and 5 million competencies so far this year. TCS's overall performance in FY24 highlights its capacity to handle intricate market dynamics, maintain growth momentum, and provide value to stakeholders in the face of changing business environments. The organization is well-positioned for future possibilities and challenges thanks to its strategic initiatives and emphasis on innovation and talent development.