TCS’ revenue growth in the June quarter — 3.5 per cent (in dollar terms) sequentially — was lower than the market estimates of 4-4.3 per cent. Operating margin declined 0.9 percentage points to 26.29 per cent, but this was better than the 1-1.5 percentage points dip the market expected.

After Tech Mahindra’s profit warning in its guidance for the June quarter, there was anxiety over the results of other IT companies. But TCS showed a broad-based growth.

All verticals, including BFSI, telecom, energy and utilities, and retail showed a rebound in the June quarter. Growth in the telecom segment was up 9.6 per cent sequentially, after a 10.2 per cent drop in the March quarter.

The company added 20 clients in the $20 million plus revenue band and one client each in the $50 million and $100 million band. It missed the consensus estimate on revenue growth due to lower revenues from Japan and Latin America. A 130 basis points dip in realisation also hurt, but this was due to factors such as change in the onshore/offshore mix, and not due to pricing.

Consistently increasing attrition is a worry though. At 15.9 per cent, the attrition rate in the April-June period was the highest in the last several quarters.

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