Tech giant Tata Consultancy Services (TCS) is reportedly considering an average salary hike of 7-8 per cent for its offsite employees and 2-4 per cent for those working onsite in the fiscal year 2024-25. According to a report by Business Standard (BS), top performers may witness a substantial increment ranging from 12-15 per cent.
TCS, India's largest IT firm, boasted a workforce of 603,305 employees as of December 31, 2023. The firm will be carefully evaluating promotions, with the process potentially being delayed until the first quarter of the fiscal year 2024-25, disclosed the report. These increments will come into effect from April 1.
Typically, IT companies announce salary hikes during the first quarter of a financial year. As per the report, the source said, “The salary increment process is nearing completion, but promotions, especially at the top level, are under strict scrutiny due to cost concerns.”
In an email response to BS, a TCS spokesperson stated that the company refrains from commenting on speculation, following its policy.
In the financial year 2023-24, TCS is said to have implemented salary hikes predominantly ranging between 6-9 per cent, while high-performing individuals received increments of 12-15 per cent. In the junior cadre, top performers reportedly received raises averaging between 10-11 per cent in FY24, a trend expected to persist into FY25.
Meanwhile, according to a recent report by foreign brokerage UBS, TCS is poised to outpace its peers in revenue growth by 100-150 basis points in FY25, alongside margin enhancements. UBS expressed the view that this potential growth is not fully reflected in the market's valuation, as evidenced by a fragmented consensus and the stock's positioning at the lower end of its long-term trading premium compared to peers. Consequently, UBS upgraded its rating on TCS.
“We see enough drivers to believe TCS can deliver industry-leading growth and margins among peers in FY25," UBS said.