TCS Reports 14% Increase in Profit

India’s Tata Consultancy Services 532540.BY +0.64% reported a 14% increase in quarterly net profit Thursday helped by several large outsourcing deals won from clients in major western markets.

The company also said it plans to absorb CMC Ltd. 517326.BY +1.18% by acquiring the remaining shares in the IT services and software company it doesn’t already own, in a share exchange.

TCS’s net profit for the three months ended in September rose to 52.88 billion rupees ($855 million) from 46.54 billion rupees a year earlier.

That was below the 53.41 billion rupees forecast in a poll of 10 analysts by The Wall Street Journal. Revenue grew 14% to 238.16 billion rupees.

Growth in the second quarter was “broad-based” across industries and the company won eight large outsourcing orders from the U.S., Europe and the U.K., Chief Executive N. Chandrasekaran told reporters. The complete acquisition of CMC would help the company cut costs, he added.

Separately Thursday, CMC, based in New Delhi, reported profit of 760 million rupees and revenue of 6.17 billion rupees during the quarter ended in September.

Shareholders of CMC, which is 51% owned by TCS, will get 79 shares of Tata Consultancy for every 100 CMC share held in the exchange offer, CMC said in a filing with stock exchanges.

wsj

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Updated: 16/10/2014 — 8:00 PM

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