Capgemini Growth

• The company revenue has increased to Rs. 18,045 cr. in FY21 from Rs. 15.749 cr., showcasing a rise of 15% year on year (y-o-y). This was due to an increase in the Time & Material contract (invoice based on time and materials) by 15% in FY21 and the Fixed price contract (invoice based on the-determined service and @ fixed price) by 268% in FY21 due to the rapid introduction of IT technologies in major sectors such as telecom BFSI and more. The company also generate an income of Rs. 8 cr. from sales of products in FY21

The company's profit after tax has grown from Rs.1,657 cr. in FY20 to Rs.1,690 cr. in FY21, showcasing an increase of 2%. The revenue per expense has decreased from 1.12 in FY20 to 1.10 in FY21. The mere increase in profit is because the company's expense on employees' salaries, bonuses, etc., has increased by Rs. 2,352 cr. in FY21, and the depreciation expenses increased by Rs.147 cr. In FY16 company received a deferred tax credit of INR 1,125Cr, which increased the profit after tax.

The company's EPS has shown an increase of 2% in FY21 over FY20. There is only a minor increase in EPS even though the revenue has increased by 15% annually. This is because the company's expense on employees' salaries, bonuses, etc., has increased by 23%, and the depreciation has increased by 21%, impacting PAT and EPS growth. There was no change in the shares outstanding, and it remained constant at 5,91,39,500.

The company's book value has increased by 5% y-o-y because it has expanded its security premium, capital redemption reserves, and share base payment reserves by Rs. 49 cr., Rs.348 cr., and Rs. 194 cr. respectively in FY21. These were increased based on additional pursuant to the business combination and employee stock compensation classified as equity awards.

The EBITDA margin has increased by 11% in FY21 compared to FY20. The gap in EBITDA growth and revenue growth is due to increasing employee benefits expenses for FY21. A significant rise was seen in salaries, bonuses & incentives, contribution to provident & other funds,  retirement benefits expenses, and employee stock compensation expense with Rs. 2,172 cr., Rs.103 cr. , Rs. 53 cr. and Rs. 40 cr. respectively. The expense on the employees was done.

The company's operating profit was Rs. 2,707 cr. in FY21 compared to Rs. 2,494 cr. in FY20.  Since the company has acquired an additional Rs. 500 cr. of computers as well as Rs. 100 cr. of office equipment, the depreciation expenses of the company have increased by approximately Rs. 150 cr. in FY21 over FY20. This led to a decrease in EBIT in comparison to revenue growth in FY21.

The company's assets grew by approximately Rs. 475 cr. in FY21 over FY20. This growth is due to the company's increase in goodwill, which is because of the acquisition of Aricent Technologies holdings and Solcen Technologies in FY21. The company acquired 128,906,056 shares in Aricent Technologies at a rate of Rs. 333.72 per share, which was 98.25% stake, and 10,000 shares in Solcen Technologies Private Limited, which was a 100% stake for a rate of Rs 53,584.89 per share.

The cash flow from operations has increased by 81% approX. in FY21 over FY20. This massive increase is due to the rise in depreciation and employee expense costs by 23% and 21%, respectively, in FY21. The net working capital also contributed to the rise in CFO as there was an increase in current provisions and other current liabilities by Rs. 211 cr. and Rs. 66 cr. respectively and a fall in non-current assets of Rs. 356 cr. because of a decrease in balance with government authorities & unbilled revenue and a reduction in other financial assets by Rs. 171 cr. in, FY21which was an impact of decrease in security deposits, export incentives, and interest accrued on fixed deposits.