Mumbai, April 21: Tata Consultancy Services (TCS) exceeded the Street’s expectations to post a 31.1 per cent rise in net profit at Rs 2,623 crore for the fourth quarter ended March 31, 2011 compared with the year-ago period.

On a sequential basis, net profit was higher by 10.7 per cent.

The markets, however, did not react positively to the market leader’s performance. The stock went through a period of high volatility in afternoon trade before closing 2.2 per cent lower at Rs 1,191 on the Bombay Stock Exchange.

The country’s largest software exporter crossed a key milestone when it reported a turnover of $8.2 billion for the full year — or Rs 37,325 crore, a year-on-year growth of 24.3 per cent. In rupee terms, revenues for the full year were about Rs 600 crore short of the market’s expectations.

The firm reported fourth-quarter revenues of Rs 10,157 crore, which were 31.3 per cent higher than the year-ago period and 5.1 per cent over the trailing quarter. Volume growth stood at 2.9 per cent.

Global brokerage CLSA said, “The TCS results are solid across most parameters.

“The most important investment indicator is the hiring pattern and these indicators are positive. Third consecutive quarter of gross hiring of over 19,000 people in the quarter (after hiring 20,219 people in the previous quarter) indicates that TCS is preparing for a big year ahead in 2011 and further validated the strength of demand recovery,” it said.

On the performance for the year, TCS chief executive and managing director N. Chandrasekaran said, “Excellent execution and a constant focus on the customer has helped TCS round off a sterling performance in 2010-11 with strong growth in the fourth quarter, while maintaining margins at historic highs.”

Chandrasekaran expects the demand environment to continue to be vibrant in the coming months.

“There are opportunities across markets and industries. Our nimble organisation structure, together with full services strategy and domain-intensive solutions, gives us a great platform to sustain growth. We continue to shape the adoption of next generation technologies by investing in new areas such as mobility, analytics, social media and sustainability solutions.”

The company, however, expects headwinds in the near term and medium term global macro horizon, chief financial officer S. Mahalingam said.

The markets in the US, Asia-Pacific, West Asia, and Africa fared well in the fourth quarter. Verticals such as retail, life sciences, manufacturing, and banking and insurance led growth.

Utilisation rates were high in the fourth quarter at 82.4 per cent; the attrition rate at 14.4 per cent was lower than its peers.