Tata Consultancy Services Ltd

NSE:TCS

Earnings Call Transcript 2022-Q3

[Kritika Saxena, Head of Corporate Communications & Public Policy]

This is conference of Tata Consultancy Services. Thank you so much for joining us this evening. We know you've had a very long day. So here's wishing everyone a very happy New Year and hope you and your family are wherever you are. The management is here with us. So let's start with [indiscernible] Rajesh Gopinathan, CEO; N.G. Subramanian, COO; CFO, Samir Seksaria; and of course, Milind Lakkad, the CHRO. So we'll kick start the press conference with the opening address with Rajesh Gopinathan as usual. Rajesh, the floor is yours now.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Thank you, Kriti. Welcome, everyone, for our earnings release for the quarter ended December '21. We have had an exceptional quarter, growing at 15.4% on constant currency terms to hit a revenue of INR 4,885 crores and $6.52 billion in dollar terms. That's a growth of 16.3 in rupee terms and 14.4 in dollar terms. The quarter also was exceptional that in the year, the calendar year '21, we have now hit a $25 billion revenue mark. The most importantly, growth came with continuingly industry-leading profitability. Our operating margin is at 25%, giving us a total operating profit of INR 12,237 crores. Similarly, the trend continues on the net profit side with a net profit margin of 20% and an EPS of INR 26.41. Our cash conversion continues to be very strong and cash from operations in this quarter stood at INR 10,853 crores, and we currently have close to about INR 65,000 crores cash on the balance sheet. The overall revenue trend was coming from a broad-based growth across markets and segments. Our most important market, North America, which accounts for 50% of revenue, grew at 18% year-on-year on constant currency terms, hitting a revenue of $3.31 billion in this quarter. Continental Europe continues to be a strong performer, growing at 17.5% year-on-year while U.K., slightly lower than the others, but still a healthy 12.7% and hitting $1 billion each in both U.K. and Europe. From a vertical industry perspective, again, our largest vertical, BFSI similar to the U.S. commentary that I gave grew at 17.9% year-on-year to hit a revenue base of INR 2.09 billion. Retail and CPG, which includes the travel and hospitality segment [ at sight ] bore the brunt of the COVID impact and very happy to report that on a year-on-year basis, they have come up with 20.4% growth to hit almost $1 billion in revenue. Underlying even the segment of travel and hospitality, which was particularly badly hit due to the pandemic for the -- has finally hit -- found revenue parity back to its peak revenue. So that's the trend on retail. Manufacturing is another vertical where we are seeing very strong participation across the board. In areas, automotive has been very strong. Overall, the vertical has grown 18.3% year-on-year, and it has come across geographies, whether it be North America or Europe and U.K. in this case also. The segmental performance is also reflected in our customer metrics. The number of customers from whom we make more than $100 million a year grew by 10% on a year-on-year basis, growing from 48 to 58 customers. Similarly, if you look at the customer metrics down the chain, we have had strong customer additions at all levels of revenue bands and at the lowest level, which is 1 million plus. Our year-on-year growth has been almost 100 where we have added 98 customers on a full year to full year -- last year to this year basis. The quarter also has been a standout quarter from our talent management perspective. Our attrition, though it is inching up, continues to be the best in class by far in the industry and we have an LTM attrition of 15.3% this year. But despite that attrition, we were able to increase our total associate count by 87,725 on a year-on-year basis, both managing attrition as well as attracting the right talent to power our growth across the board. So looking back at the quarter, it's been a quarter of the seasonally weak quarter, a quarter of significant growth across almost all our key segments, whether it be verticals or markets. And you're seeing participation on all parts of the customers' digital and technology transformation journeys. As you know, we have continued to build out our capabilities across a wide spectrum, whether it be cloud, whether it be digital, analytics and other areas, and we see continued strong traction across the board. From a pipeline perspective also, we crossed a TCV of $7.6 billion this quarter, and we saw strong TCV across all segments like North America, BFSI, retail, et cetera. So overall, net-net, a very strong quarter. And with that, I want to return it back to you, Kritika, and we'll take questions afterwards.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

Thank you, Rajesh. So we'll start the question-and-answer session now. So let's bring in our first question, which is coming in from Sajeet Manghat from Bloomberg Quint. [Operator Instructions]

[Sajeet Kesav Manghat]

To begin with Rajesh, I just want to get an idea of the growth, which you're going to see coming on the back of the $7.6 billion TCV that you have booked in Q3? And is it fair to say that based on the kind of TCV that you have been clocking, you would cross the FY '21 TCV of $31 billion and the revenues, which you've grown in Q3, you will end FY '22 with higher teen growth rate going forward? For at least for the FY '22, you'll grow 18% to 19% year-on-year. My second question is for Samir, which is on margins, basically. There's been some pressure on margins, but there is a commentary in your release saying that you're seeing bottoming out of actually -- of attrition bottoming out and there could be more attrition going forward in that. So will that be able to bring back your margins about 25% in the coming quarter? And final for N.G. is on bank and -- banking and manufacturing has seen growth, but it's muted as compared to retail and communication on a quarter-to-quarter basis, what was the reason for that?

[Rajesh Gopinathan, CEO, MD & Executive Director]

Sajeet, thanks, and very happy to hear you, too. The numbers, as we said, is actually same compared to last quarter at $7.6 billion, but a very healthy number when you look at it on a year-on-year basis. And so trend line, you would have seen continuously increasing one. But the standout aspect of this quarter, which is, again, similar to what we said last quarter, is that the TCV is very broad based. It's coming across segments. It is coming across markets and it is not skewed by any single large deal. So it's a very broad-based growth that we are experiencing a very broad-based demand environment. And we are participating strongly across the full spectrum of demand. So that gives us quite a lot of confidence in terms of the overall outlook for the future.Beyond that, I wouldn't like to quantify the numbers, but I think the TCV is both what we have had in the past, those are materializing in the revenues that we are seeing now and the current TCV also positions us strongly as we look forward.

[Samir Seksaria, Chief Financial Officer]

Sure. Thanks, Rajesh. And on the margins, suggest to your question, our margins were at 25%, and that's down 60 basis points from the previous quarter, but we still maintain industry-leading margin. And to your question on attrition. So as I have said in my comment, we have done good tactical initiatives or technical measures during the quarter as well as long-term measures to tackle the churn or the supply side challenges, which the entire industry is seeing. As I had said last time as well, as far as the churn continues across the industry, we'll do whatever it takes to -- whatever interventions are required as well as we'll look at measures. Our priorities would be to capture growth and ensure business continuity for us as well as our customers. So while we also have the lowest attrition, but we'll take all those measures required. And once it normalizes, is when we'll look towards optimizing the margins.

[Aarthi Subramanian, Non]

Thank you. And let me doubt wish all of you a great start to the year, and let's hope that 2022 will be a much better year than the previous two both in terms of personnel as well as professional front. Banking, Financial Services has been our largest vertical, as you know. And it's grown by about 18% year-on-year during this quarter. And manufacturing has also done well for us. It's grown by 18.3% year-on-year. But I take your point that sequentially, there has been impact lower than normally what we would expect. But as you know, in this particular quarter, these 2 industries, they are particularly having challenges with respect to furloughs. In Banking Financial Services, we had our challenges of furloughs, which we typically account for. And that is seen in the sequential growth that we are putting in. But having said that, look, we see a phenomenal momentum and the overall deal value or at least total contract value signed in banking financial services this quarter is $2 billion plus. And manufacturing also, I think slightly a growth was [ flat ] because of the furloughs as well as some shutdowns in factories and things like that chip shortages and things like that. But overall, nothing wrong in any of these 2 verticals, and we should see the growth momentum continuing on these 2. Thank you.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

The next question from Reema Tendulkar from CNBC.

[Reema Tendulkar]

Gentlemen, it's great seeing you, and congratulations on a strong quarter. And again, I wish you all a very happy New Year, a healthy one. Rajesh, the first question is have -- according to you, what has been the change in the demand environment in the last 3 months for better or worse, if you could provide some nuance to that? And how do you expect BFSI to perform -- U.S. BFSI to perform in light of rising interest rates. And just on deal wins. You've given us an absolute number, but could you give us a sense of the mix between smaller deals as well as larger deals because we are seeing -- anecdotal evidence seems to suggest we are moving towards a greater number of smaller deals. So is there a way you could quantify that? And Milind, just one question, on this very strong hiring number of 28,000 -- on the back of 20,000 plus that you did in the prior quarter, what is the mix, what percentage of this 28,000 of hiring that you've done were fresher hiring. What is the experience age back? Thank you.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Thanks, Reema. The demand environment over the last few months, I wouldn't say, there's much to call out on in terms of change. As you recall, we have always spoken about this medium-term visibility that we have on a very strong demand environment and the overall technology upgrade cycle that is currently underway. We are seeing a broad basing of that. if you look at it from a vertical to vertical basis, for example, manufacturing and in fact, auto, which was one of the more impacted ones at the post-pandemic scenario is seeing significant amount of investments, both on the EV side with the OEMs as well as into the Tier 1 side. We are seeing direct-to-consumer setting going on. We are seeing movement into subscription-based revenue. We are also seeing significant amount of adaptive supply chain and supply chain resilience being modeled to take care of the chip shortage and prioritization-related one. So you are seeing much more broad-based kind of demand across industries. I just gave manufacturing as 1 example. Same thing holds good for healthcare or retail, multiple industries. Reema, specific question on BFSI. I don't think our demand is significantly impacted by the interest rate scenarios. Typically, that's -- it's a balance sheet item, and they don't -- most of the technology commitments that banks have far exceed or far are not very volatile to immediate interest environment. We see banking investing into -- continued to invest into payment modernization, into customer experience, a lot of focus on digitalization. And those are the themes that have been there for some time, and they are continuing to pick up momentum. And I don't see that significantly changing with the tightening interest environment.

[Milind Lakkad]

Thanks, Rajesh. Reema, with respect to the mix, about 34,000 associates at entry level, which have come in. And associates specifically from the market is based on the demand from each vertical. So you put the math of a significant amount of addition coming in from the campus and the rest coming from the market.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Overall, on the banking financial services side, Reema, I think we have a mix of large and small deals. And more importantly, I think at least the 4 deals, which are fairly significant deals, and they're all in the areas of the future, which is what is making the whole sector very interesting. And we are participating in for example, crypto, crypto exchanges, crypto clearing settlement, payments modernization, as Rajesh pointed out, carbon credits marketplaces. I mean there are all things which are of the future, and they're all things, which we would like to join, we would like to participate and really leverage our contextual knowledge, market knowledge and to my knowledge in that particular demand. And from talking to our customers and customer portfolios, there are plans for the coming year -- for this year has been quite neat. And there we are not seeing any reduction in budgets or anything. On the other hand, they all continue to -- they would like to invest in typically more digital, more growth and transformation initiatives. And overall, I don't see any slowdown per se, except that it's otherwise seasonal, yes.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

Next question from [ Anisha Jain ] from [indiscernible]. Anisha, you're on mute. You have to unmute yourself.

[Unknown Analyst]

Can you hear me now? The first question is to Rajesh. You just talk about medium term. In calendar year '21, you achieved the revenue of $75 billion, and we are at the cusp of multiyear up cycle. If you continue the 15% growth rate for the next 5 years, can we see a revenue of around $50 billion mark in a period of 5 years or not? Samir, a question to you on the deal pipeline, you just talk about the segments which are doing well, but is there any mega deal, which is there on the horizon? And as far as the pricing is concerned, have you been able to negotiate better prices with the clients? And lastly, N.G. just to you. India growth has moderated. It tracked this quarter at 15% versus 20% last year. Going forward, do you think there can be any impact of Omicron be better in terms of the talent and employees or in terms of demand on India business?

[Rajesh Gopinathan, CEO, MD & Executive Director]

Thanks, Anisha. $50 billion is definitely a possibility, whether it happens in '26, '27 or '30. That's the only question. And I think it's too premature for us to be able to take a call on it. But the way we see it is that there is demand out there. And what is required for that is a significant focus on our customers, a significant focus on talent development and making sure that our partnerships are in place. to move the ecosystem and to participate in the ecosystem very positively. We have spoken earlier in this call about our focus on talent. We've spoken about our focus on customers. From a partnership perspective, I want to touch upon what we have spoken earlier about cloud and our significant investments that we're making on that area. I'm very happy to say that across all the 3 major hyperscalers, we have emerged as their partner of choice for all 3 major platforms. And this similar partnership focus continues across all our key alliance partners. And we believe that working together in this ecosystem, we should be able to get those milestones faster and in a manner that I'm sure even you will meet the expectations that we are setting.

[Samir Seksaria, Chief Financial Officer]

On the deals, as you asked, we have a very healthy share of deals which are in the 50 million to 500 million range, whereas we don't have, in this quarter, any deal, which would be above 500 million. But on large deals, we have a very healthy share of it. The second question was on pricing. We did have a slight realization uptick this quarter itself, and we look forward for the realization improvement over the next future quarters.

[Ganapathy Subramaniam Natarajan, COO & Executive Director]

Yes. As far as the India geography is concerned, we had a fantastic quarter in Q3. It really, I think, we participated well. Moving forward, it's very hard to say. But then as we point out, India and some of the regional markets are always volatile. But as you have noticed that we had a great renewal passport program that happened. And in line with the government [indiscernible] number initiative, we have chosen to be part of some of those big programs, big programs, and we are investing in some of those things, taking certain proactive long-term calls to be part of the nation building exercise the government is doing. And hopefully, our efforts in the India geography will play over the longer time in a much better manner.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

And our next question is from Sangkalp from Reuters.

[Sankalp Phartiyal]

I have two questions. One was about how -- could you call out some sectors that you may potentially be concerned about during the Omicron wave across U.S. and some other geographies? Rajesh was saying that travel, et cetera, was hit last year. Is there a chance that, that could happen again? And I also wanted to ask the impact of higher salaries on your margins as you go into this mode of overdrive where you're hiring a lot of people across the board laterally and freshers. And also, I wanted to ask if you could give a bit of detail about this talent cloud model that you've spoken about previously. How is that helping as the industry is under the supply crunch? I mean we're not expecting this to be over anytime soon. So those questions.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Yes. Sankalp, the current wave, its impact on specific industries is difficult to say. As you said, travel could be, but it could very well be a secondary impact. I'm sure you are following the news that a lot of delays and a lot of cancellations are coming through just because of the impact on the group rather than supply side. So it's a supply side impact rather than a demand side, in fact, how long that lasts and how that will play out, I think it's too volatile in an environment for us to speculate on. And the more important thing is that even without a significant amount of international business travel coming back, the travel industry has managed to find its footing as it were. And we think about it from -- when I talk about it from a TPH perspective, we have broad-based our presence in that segment beyond the airlines and hospitality into logistics shipping and other areas, postal services, railroads and significantly broad-based so that we are able to backfill that revenue. If I were to take just the airline segment, that is still way below its peak pre-pandemic peaks, but the overall TPH revenue has managed to come back to where we started declining. So that's a take in terms of specific was impacted. The point that you raised about salaries, yes, it could have a short-term impact on margins, but we believe that investing in talent is the right thing to do, both from our own perspective as well as the role that we play with customers. So practically, and in the short term, those impacts will have to be dealt with. But in the medium term in the downturn, it will be net positive to us both on the revenue side as well as on the overall margin side because we are hiring the people that we want to hire and significantly investing in retraining them so that we have the right talent, which is deeply integrated with the overall TCS ecosystem. So that's the one, but I want to hand it over to Milind to answer your question about the talent.

[Milind Lakkad]

Yes, thanks, Rajesh. I think to cloud is definitely helping be it in terms of enhancing customer satisfaction or we meet in terms of increasing our revenues. Being able to put an expert and from any location, and there is a lot more acceptable to our customers now and to our own managers now than ever before. And that has called a significant creation of strategic value for our customers and for the organization both. So being able to work in New York for a customer in Chicago or being able to work in Pune, where customer is not anymore looking for somebody to come in and be able to pay the premium because based on the skills, not based on the location, it is the way it is going, and it will go that way. So Talent Cloud is definitely helping a lot, and it is the future for all of us.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

Next question from Chandra Srikanth from Money Control.

[Chandra Srikanth]

Happy new year to all of you. Rajesh, just want to understand the overall deal environment because while some analysts say that deals are getting smaller, we are still seeing some large deals. But overall, can you break it down for us? Are there still mega deals, large deals, smaller deals, which segment will TCS go after? A question for Samir, in terms of the pricing, analysts say that there is a possibility of price hikes of up to 5% to 7% for some of these new age transformational kind of projects, hot skills. So are you able to get that pricing gain? And will it help offset the loss that you're seeing because -- the cost that you're seeing because of your talent costs going up?N.G., in terms of the return to work plan a couple of as announced that they're going to close offices worldwide for the next 4 weeks. Do you see a need for measures like that? Or will your current hybrid model work? And finally, Milind, congratulations on the 2 lakh milestone as far as women employees are concerned. I want to ask you about the overall head count number. H1, I think you hired 43,000. H2 was supposed to be 34,000. We've already met that target. So can you give us a sense of how much you will be adding in Q4?

[Rajesh Gopinathan, CEO, MD & Executive Director]

Yes, Chandra, I think your first question, which was the one was on the pipeline. So overall, we don't have a specific preference of small deal, medium deal or large deal, we participate across the board, as you have seen us and we stay continuously engaged across the full spectrum. The very large deals, the $500 million kind of a deal, they're by nature, are few and far between. More importantly, they take a long time to mature, and they are unpredictable in terms of when they will close. There are a few in the pipeline, but we can't take a call as to when that will come through. The more -- the here and now ones are the medium-sized ones and relatively large, but are not kind of size that we're talking about. And those are what constitute the majority of our current pipeline and we'll continue to be the bedrock of our overall TCV with the one-off mega deals coming in and spiking it occasionally. So basically, meaning that we don't have a preference of one versus the other. And current TCV is composed of the relatively large and medium-sized deals to the pipeline has an equal representation compared to our historical trends.

[Samir Seksaria, Chief Financial Officer]

I think [indiscernible] to your question.

[Ganapathy Subramaniam Natarajan, COO & Executive Director]

Go ahead. Samir, please.

[Samir Seksaria, Chief Financial Officer]

Chandra, to your question on pricing, our pricing has been stable with an upward bias. And if you look at -- from a customer perspective, the relationships, which we have with our customers are long term. So we don't look forward for short-term variations to be discussed with the customer. Having said that, if you look at our business, our traditional services are differently priced whereas the new age services have more pricing resilience. And with that is what I said to a previous question, that we look forward towards improving our realizations even further. So we had an uptick in realization this quarter and we'll look forward towards improving our realizations in the future quarters as well.

[Ganapathy Subramaniam Natarajan, COO & Executive Director]

With your question on work from home work from office. We ran one of the extraordinary vaccination programs for our employees and their dependents. And more than 90% of our employees and dependents are vaccinated. And we are staying focused on improving our secured borderless workspace model and architecture as well as our 25x25 model. We are staying committed to that. Some of our leadership team, and I think the next level of leadership team have started to attend office and we have given them the flexibility to decide when they would like to be in the office, when they choose to work from their home. But the intent is to really see how they would like to operationalize the 25x25 operating model, always prioritizing employee safety. I think the business continuity plans and the 25x25 operating model, these 2 will be rolled out or will be defined at pretty much at the client level and the project level. And then that will constitute how people will come and return to office and where they will work, how they will work, all of that. So we are staying committed to our 25x25 working model.

[Milind Lakkad]

Thanks, N.G. Chandra, no, we are very happy that we have crossed that 200,000 women in the workforce milestone. It's a proud moment for us, for all of us. Thank you. With respect to your question on the trainees coming in, so we -- like you said, we hired 43,000 in H1. I said in the last quarter that we will hire 34,000 in H2. We ended up hiring 34,000 in this quarter itself. What I can say is our intensity will continue. I don't have the number to give it to you for Q4, but our intensity of hiring will continue.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

And the next question from Shivani Shinde from Business Standard.

[Shivani Shinde]

Congratulations, and happy New Year. Rajesh, and this question is for Rajesh and N.G. both. Revenue beat $25 billion for this calendar year '21, the size of the company is becoming bigger and bigger almost every quarter. Does the size then become the reason why the higher double-digit growth kind of get skewed? I mean despite all these great numbers, at the end of the day, we will be saying that, "Okay, this is what the revenue number was." And so does the size somewhere brings that down the impact of growth and hence the higher double-digit growth numbers start looking smaller and smaller? That's for both Rajesh and N.G. And here's to you, on Passport deal, we congratulations. That's the second case also, TCS has got it. You did say that you are taking some long-term calls for the Indian market. Could you elaborate a little bit more on that. Milind, on the numbers, a great set of numbers, the way you are hiring. Could you just throw some more color on the compensations that the company would have given for this quarter? If you could elaborate more on that?

[Rajesh Gopinathan, CEO, MD & Executive Director]

Very happy to hear from you too, Shivani. See, the logic that you're putting was equally applicable when we were a $10 billion company or a $5 billion company. So the size looks large from our historical perspective, not necessarily from where the opportunity size. So I believe that our expectation of growth and our expectation of sustained growth should be benchmarked to where we think the overall opportunity size is. And when we look at the market out there and the opportunity, I believe that there is no reason why we should not aspire to continue to grow. Whether that growth will be 15%, it will be 20% or 10%. That will vary period to period. But the larger point being that there is significant at available for growth, and that is what we are setting up the company for, both from a talent perspective, from a customer perspective, the investments and about our overall philosophy. So that's the perspective. I think we need to stay disciplined we need to stay focused. But the most -- I mean this is the industry to be. And this is the time to be in this industry, and the market is out there, it's up to us capture it.

[Ganapathy Subramaniam Natarajan, COO & Executive Director]

We don't want to be asked to can this element dance again. I mean I think that we are extremely focused on and our organization model has always been ahead of time, right? To make sure that we are agile, we are nimble, and we have empowered and decentralized organization structure by which the companies really can be looked upon as several -- small companies and each one hold themselves accountable investments, and create the right knowledge base and assets and grow the business, right? I will leave it at that. As far as India is concerned, there are -- we believe that India will be a platform-driven market. There are -- if you really look at the consumer as well as the institutions operate. Everybody is used to a platform, everybody is going after digital in a big way. Our consumer of digital platforms in a big way, right, be it insurance, be it banking, be it manufacturing or -- and thanks to the India digital stack, and many of these things are happening. And so our view is that we need to be part of each one of these platforms, position ourselves with the right set of apps, right set of platforms that can integrate very well with the India digital stack and provide each one of our customers. Whether it is government or the industry or even the consumer for that matter, to be able to do what they want to do pretty much invisibly and seamlessly. And I think in that context to that, we are investing in platforms, investing in banking side of it. We are investing in a suite of APIs and microservices that can be connected from practically any anywhere to anywhere, within the India digital stack. So there are many initiatives that we are bringing, but it will be a platform-driven market and it will evolve as we see it, and we are well-positioned to participate in that particular segment and I trust that gives you an answer.

[Milind Lakkad]

Yes. Shivani, with respect to the compensation question you asked, I would say we responded this way. Our progressive people policies, our policies such as in career linked to learning, fast track [ careers ] linked to learning is what excites people. And what is what keeps them going. They're ability to really significantly increase their compensation by going through the path, which we are defining it for them is what keeps the organization excited day in and day out for us. And that is what I would say. In addition to that, if I had to give some quantification on numbers, we have promoted 110,000 people this year and we're going to promote another 40,000 people in this quarter. So all of these things together, getting people to those levels where they feel they deserve their -- where they need to be, recognizing them through a proper objective process. And ensuring that they are learning and they are creating value for themselves in the process is what we believe in what we have been doing, and it is working for us, and we continue to improve on it as we go along.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

Next question from Romita Majumdar from Economic Times who's on audio as well.

[Unknown Analyst]

Congratulations on the numbers. For Rajesh, I would like to understand if we are seeing this long-term shift to more of midsized deals. Does that mean that the pool of competitors was as deals also increased with more, maybe mid-caps and small cap and smaller companies basically buying for the same set of deals? Of course, differentiation is always there, but for the clients, is it a larger set of competitors to deal with? And also, can you please share your renewals number here. And for N.G.S., if you could give us some color on the kind of performance from Platforms business as well as the kind of incremental revenue that it is adding to segments like BFSI and Retail.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Romita, I did not say that there is a shift to smaller-sized deals. What I said is that when you look at it from a pipeline perspective, the distribution of the pipeline in terms of mega deals, large deals and mid-sized deals continues to be similar to what it has been in the past. Just that in the nature of the mega deal, they close, they're a fairly long cycle kind of deals and they don't close with the same, what should I say, cadence that is relatively smaller means [indiscernible]. So our current quarter does not have any single very large deal in there. But the pipeline continues to be well-distributed across all deal sizes. So there is no structural shift in the market towards either long or towards small. N.G.S.?

[Ganapathy Subramaniam Natarajan, COO & Executive Director]

Yes, overall, Romita, products and platforms did well this quarter. TCS banks continue to win new clients. and had a great quarter in terms of getting into some of the new areas that we wanted to get into. And we also completed one of the big mergers in Saudi Arabia between, for example, the -- so the National Bank, right? The whole merger between Samba and the National Commercial Bank as it originally used to be called, that merger program got completed in a record time of 9 months. And it's been a great success there. Ignio, for example, did extremely well this quarter, again, won significant number of customers. Our omni-store e-commerce platform, again, that did quite well. And overall, the MasterCraft has won 24 new wins in this quarter, and it's quickly evolving in itself into a great low-core, no-core platforms, right? So overall, we had a very good quarter in terms of all our products and platforms, not to mentioned about TCS hubs and things like that. Regarding the incremental revenue on how these platforms contributed, I have not done that analysis. I have not tracked it, but I will do that, and I'll get back to you.

[Operator]

Next question from Saritha Rai From Bloomberg.

[Saritha Rai]

I would ask you about 2 things particularly. One is the -- beginning of the year, conversations that you have with clients across verticals and across geographies. What are you reading from those conversations for this calendar year in terms of IT budgets? That's the first question, both for Rajesh and N.G.S. And then the second question is that all of the talent challenges such as training, hiring, reskilling, pay raises. How is that going to -- how are you going to factor that into the pricing? Is that going to come into play -- has it already come into play as you price deals? I was very curious about that. And congratulations on hitting the 36% and 44% women in the workforce milestone. There are 4 trials in front of me. Very soon, I hope there is a fifth or even 1 of the 4 is populated by a woman. So I look forward to that day. Thank you so much.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Thank you, Sarita. The first question was -- what was the first question?

[Unknown Analyst]

Our first question was about client conversations across verticals and geographies.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Thank you. So we'll give you a commentary based on end of last year kind of commentary. We conducted a series of customer events and reach outs before the current set of pandemic-related close ones. And overall, across all I wouldn't even say almost across all sectors, customers were very positive about the long-term visibility or the medium-term visibility of their technology investment agenda. And their business transformation and even continues at pace and we see that across industries. So when we look forward into the next year calendar year, the demand environment continues to be very robust, and I see no reason for any flattening of that demand advancement. N.G.S. [indiscernible].

[Ganapathy Subramaniam Natarajan, COO & Executive Director]

Yes. And Jeff, if you want to I think -- When there is a window of opportunity, we chose to fly and we chose to meet with customers. I think Rajesh spent nearly 12 days in U.S. and met with a host of customers last quarter. Overall, we found that there is a general belief that they would like to meet, number one. And their offices are all geared to meet, taking adequate precautions of safety of people and safety affair. And for example, as long as your test results are good, you are allowed to entry into the -- beyond the restrictions. And once you are inside, I found that there is actually people are comfortable meeting and taking, right? So I think the hybrid model is something that will stay. And that's a great realization that they will all work in hybrid environment. They will increasingly lay emphasis on person-to-person meetings for very premium time, premium issues. I'll put it this way, right? It's not that they will meet in person for anything and everything. Overall, they all believe that they will have to coexist with this environment for the foreseeable future. And they look -- that look at this as business as usual. And accordingly, they are drafting their own business plans, their own growth, their own safety measures, resilience measures and so on and so on, right? And profusely, everybody was thanking the work that TCS has done and our employees have done in the last 12 to 14 -- 12 to 18 months. And some of them, we say, look, how seamless it has been for their growth programs for their efficiency programs, resilience, programs and so on so on. As far as the people hiring talent, et cetera, et cetera, I think fairly, it is business as usual for us. Only thing is that calling ourselves accountable for the skills that we need has been the hallmark of TCS, right? I think we have continued to invest in people. Organically, we hire them. We have groomed them. We have trained them. We've given them opportunities to grow their skill sets, motivated them, inspire them, nodged them in terms of building the right skills that they all need and to be relevant into our customer base. I think that has been the hallmark of TCS, and we will continue to do that. And there are -- in terms of pricing, yes, certain skills, certain type of projects, certain speed to market, speed to value-type of projects, demand a certain level of pricing. But at the same time, we are very conscious of our long-term relationships with the customers, the current situation in which they are in. And the value, 360-degree basis is more important for us, and that determines the price that we charge and the price that they pay.

[Operator]

Next question, [ Jochelle Mendonca ] from ET Prime, who is joining us on audio. Gisele?

[Jochelle Mendonca]

Congratulations on the results. I have 2 quick questions. One is on the statement that TCS made that attrition may be bottoming out. So I was wondering if you could give me any color on what is driving the statement? Are resignations standing down? Any color that gives you this confidence? And the second question is a follow-up to N.G.S. or to Shivani's question. You said that TCS was investing in platforms for the government for corporates and consumers. So is that just [indiscernible] or could you give some color on the platforms that you're investing in on the consumer side?

[Milind Lakkad]

[indiscernible], Milind Here. I think when we said bottoming out, we actually meant that churn will come down in this quarter. In Q4, the churn will come down. The way we measure arithmetically measure LTM may still go up, but the churn for the current quarter will come down. That is a clarion I want to give it to everyone. And we believe that it is flattening. It is not -- I will not say bottoming out, it is flattening, but the churn will flatten, may reduce a bit of churn. LTM may still continue to go up a bit.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Yes. I think on the India side platform aspect, I think what I mentioned is that everything that we do for our customers in India, specifically, it's more and more shifting towards a consumption-driven market. And people are very comfortable using a platform, comfortable with using, let's say, a mobile phone to do many of the things that they want to do. In that context, every platform that is out there, whether it belongs to us, it belongs to somebody else, we need to find mechanisms by which we hook ourselves into this, and that's exactly what we are doing. But in the interest of time, and if it's of interest to you, we can have an off-line conversation separately, but I will leave it at that at this point.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

Harshada Sawant, CNBC Awaaz. How should I think you have it unmuted yet. We can't hear you. Can you mute unmuting again? Okay. So let me just get back to Kushal, who's next and we'll try to see if we can get back to Harshada. So Kushal Gupta, Z business was our last question.

[Unknown Analyst]

So my question to you, Rajesh, would be, particularly on the growth aspect as in going forward for the next like particularly FY '23. How the growth trajectory would be going ahead because we are seeing like the kind of revenue, which the company has showed over time. So that has been brilliant. So going forward, what would be that? And secondly would be on the margin front. So margin per se, going forward, would it be stable right now at the current juncture which it is right now. or it would go down to some extent because one is the attrition and the second is probably the travel cost going high.

[Rajesh Gopinathan, CEO, MD & Executive Director]

Thank you, [ Kushal ]. From a revenue growth perspective, as I said, the demand environment continues to be strong and the opportunity headroom is quite high. So it will definitely be our endeavor to maintain the growth momentum that we are currently enjoying. Specifically, what that will imply in terms of numbers, we won't comment on. But definitely, we'll be going all out to try and maintain the momentum. On the margin side, similarly, there is kind of a very strong demand environment should be overall conducive to margins. Practically, there might be some amount of volatility given the overall market environment that we have seen. But we are confident that a combination of what we see on the demand side and the investments that we're making on the supply side, where we are significantly investing in reskilling and bringing our own talent and making our growth and sustainable that would be very supportive to the overall margin scenario. So we should see good growth with stable margins.

[Kritika Saxena, Head of Corporate Communications & Public Policy]

Okay. We have very tight on time. Harshada, if you're back, one quick question, please. Okay. No problem. We'll take that offline, Harshada. So thank you so much, everyone, for joining us in this press conference. I hope you have a lovely evening, and you're safe and sometime this year, we get to meet in person and host you here. Thanks a lot. Goodbye.