Q3FY22: TCS vs Infosys vs Wipro - Large deals, growth across all verticals drive the performance

14 Jan 2022 , 08:40 AM

Major IT companies Infosys, TCS and Wipro have announced their December 2021 (Q3FY22) quarter earnings. TCS and Infosys beat market expectations, while Wipro missed estimates. TCS, Wipro and Infosys earnings were led by large deals and growth across verticles. The companies operating margins benefit from rupee depreciation.

Here’s how TCS, Wipro and Infosys performed in Q3FY22:

Tata Consultancy Services (TCS):

TCS garnered a 12.3% growth in consolidated net profit of Rs9,769cr for the quarter compared to a profit of Rs8,701cr a year ago same quarter. Consolidated revenue from operations increased by 16.3% to Rs48,885cr in Q3FY22 versus Rs42,015cr in a similar period of last year.

In constant currency, the revenue growth was at 15.4% yoy in the quarter under review. TCS posted a 4% quarter-on-quarter revenue growth in CC.

In the quarter, all verticals grew in the mid to high teens. Growth was led by Retail and CPG (20.4%), BFSI (+17.9%) and the Manufacturing vertical (+18.3%). Technology & Services grew +17.7%, Life Sciences and Healthcare grew +16.3% and Communications & Media grew +14.4%.

Infosys:

The company posted a strong December 2021 quarter with consolidated profit rising by 11.8% to Rs5,809cr compared to Rs5,197cr in the corresponding period of the previous year. Consolidated revenue stood at Rs 31,867cr in the quarter under review, growing by 22.9% yoy and 7.7% qoq. In terms of constant currency, revenue growth was 7% qoq and 21.5% yoy.

The company’s growth remained broad-based and deal momentum robust, with digital transformation rapidly scaling across verticals and regions. Further, large deal wins accelerated with TCV of $2.53 billion in Q3. The operating margin for the quarter was healthy at 23.5%, with Free Cash Flow conversion at 92.6%.

The company has raised its revenue guidance going forward. It’s revenue guidance is between 19.5%-20.0% for FY22.

Wipro:

The company missed estimates in the third quarter with consolidated net profit that was attributable to owners at Rs,2969cr, broadly flat compared to a profit of Rs2,968cr in the same quarter a year ago. Consolidated revenue stood at Rs20,313.6cr in the quarter under review, rising from Rs15,670cr of Q3FY21 and Rs19,667.4cr of Q2FY22.

In dollar terms, IT Services Segment Revenue was at $2,639.7 million in Q3FY22, an increase of 2.3% QoQ and 27.5% YoY. Non-GAAP constant currency IT Services Segment Revenue increased by 3.0% QoQ and 28.5% YoY.

For FY22, Wipro raised its revenue target in the IT Services business in the range of $2,692 million to $2,745 million. This translates to a sequential growth of 2.0% to 4.0%.