Ratan Tata's TCS CFO makes BIG statement on wage hikes of employees: 'Priority is...'

TCS, India's largest IT services company, recently announced its Q1 FY26 results. Its business witnessed headwinds on growth and margins. Now, its Chief Financial Officer (CFO) Samir Seksaria has said that delivering wage hikes for its over 6 lakh employees is a 'priority' for TCS. Speaking to PTI, Seksaria made it clear that TCS will focus on growth with profitability.

Stating that TCS has rarely resorted to deferring wage hikes, unlike peers, Seksaria said, "My priority is getting back to the wage hike." He, however, did not specify when the hikes will be delivered. Typically, the annual wage hikes crimp the operating profit margin by over 1.50 per cent, Seksaria said.

TCS Q1 results

The company showed a 6 per cent increase in net on non-core income as demand got impacted due to macroeconomic and geopolitical troubles, and deferred its annual wage hikes that typically set in from April. It reported a 0.20 per cent narrowing in the number at 24.5 per cent for the June quarter, but Seksaria stressed that the intent is to push the margins up into the 26-28 per cent aspirational range. Seksaria explained that investments in upfront hiring to capture demand as it comes in hurt the margins, as lack of demand pulled down utilisation levels.

TCS market cap

The market cap of TCS currently stands at Rs 11.81 lakh crore, as of July 11. The share price of the IT firm closed at Rs 3,264.50 on Friday.

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 TCS looks to widen margins

As the company looks to widen the margins, it is grappling with a set of controllable and uncontrollable factors, Seksaria said, pointing out that upping the utilisation and other organisational tweaks are the controllables, while demand is the uncontrollable.