TCS vs Infosys: Hiring, dividend, order book among 5 key things to know in Q4

Infosys share price on Wednesday 1,388.60 on the BSE, down 2.79%. TCS Ended with a decline of 1.61% 3189.85 each.

While TCS is the largest IT company Infosys ranks second in terms of market share.

TCS M-Cap is over by the end of April 13 11.67 lakh crore and Infosys held an M-cap of more than this 5.76 lakh crore.

Let us compare 5 key highlights between TCS and Infosys during Q4FY23 and FY23.

1. Profitability and Margin:

Infosys is the latest to announce Q4 results. In the quarter, the company reported a sequential decline of 16% 6,128 crores. However, PAT improved with a growth of 7.8% 5,686 crore in Q4 of FY23.

Overall, Infosys’ annual consolidated net profit up 9% in FY23 22,110 cr to 24,095 cr in FY22. The company’s operating margin stood at 21% for both the fourth quarter and overall FY23.

In the case of TCS, the Tata Group-backed company earned a net profit of Rs. 11,436 crore in Q4FY23, up 14.8% YoY and 5.03% QoQ. In addition, net margin stood at 19.3%, while operating margin remained stable at 24.5%.

Unlike Infosys, TCS posted single-digit growth sequentially in Q4.

For the full year, FY23, TCS profit up 10% 42,303 crore to 38,449 in FY22.

2. Top-Line Front:

In terms of revenue, TCS saw a modest 1.6% 59,162 crore to Rs. 58,229 crore in Q3 of FY23. At the same time, a decline of 2.2 percent has been recorded in the revenue of Infosys. 37,441 cr in Q4FY23 from 38,318 crore in the previous quarter. Year-to-date, TCS and Infosys registered growth of 16.94% and 16%, respectively.

In constant currency, Infosys’ revenue growth declined 3.2% QoQ, but rose 8.8% YoY. TCS’ revenue growth stood at 10.7% YoY.

For the full year, TCS clocked in revenue 2.25 lakh crore, which grew by 17.58% 1.92 lakh crore in FY22. Infosys’ revenue from operations grew 20.7% to ₹1.46 lakh crore in FY23 from ₹1.21 lakh crore in FY22.

3. Order Book:

In terms of order book, TCS registered the highest ever number of large deals in Q4FY23. The company’s pipeline for the fourth quarter comes in at $10 billion. For the full year FY23, the company’s order book comes in at $34.1 billion.

Infosys, on the other hand, received orders worth $2.1 billion in the fourth quarter of FY2023. The order book for the full year stood at $9.8 billion.

4. Recruitment and attrition rate:

Though both Infosys and TCS saw a sharp decline in IT Services LTM attrition rate, both the companies were in opposite directions in terms of employee count in Q4FY23. It needs to be noted that Infosys saw a much sharper reduction in attrition rate than TCS. Meanwhile, while TCS marginally increased its headcount, Infosys laid off a large number of employees during the quarter.

Infosys’ attrition rate declined to 20.9% in Q4FY23 as compared to 24.3% in the December 2022 quarter. While TCS attrition rate slipped to 20.1% as compared to 21.3% in Q3FY23.

In terms of headcount, TCS posted a net addition of 821 in the fourth quarter – taking the total headcount to 614,795 by the end of the fiscal year. In contrast, Infosys reduced its headcount by 3,611 employees – taking the total headcount to 3,43,234 in the fourth quarter of FY2023. TCS also said that the company honored all job offers made in FY23, and also on-boarded over 44k freshers.

In the December 2022 quarter, TCS had 613,974 employees, while Infosys had 3,46,845 employees.

5. Dividend Benefit:

Both the IT giants have declared the final dividend for FY23.

TCS declared dividend 24 per equity share. The Company will announce the record date for the final dividend in due course. Prior to the final dividend, TCS has paid a total of three interim dividends which add up to 9100%. 91 per equity share to the shareholders for FY23.

While Infosys declared dividend 17.50 per share. Company previously paid dividend 16.50 per equity share. Together, Infosys paid the total 34 per equity share in FY23 – an increase of 9.7% over the previous financial year FY22. The company has fixed June 2 as the record date to determine the eligible shareholders.