Tata Sons saw its profit more than doubling in fiscal 2020, driven by higher dividend contribution from its software services subsidiary TCS. Profit soared 130% to Rs 2,680 crore from Rs 1,145 crore in fiscal 2019.
The profit could have been higher, but it made a provision of Rs 16,439 crore towards the liabilities of Tata Teleservices, an analysis of the Tata Sons FY20 report revealed. The holding company of the Tata Group has so far written off Rs 60,000 crore of its investments in the loss-making telecom business. While the consumer mobile unit was sold to Bharti Airtel, the enterprise business remains housed under Tata Teleservices.
Revenue from operations, which mainly comprise dividend income and brand royalty fees, rocketed 158% to Rs 24,770 crore. TCS’s contribution to revenue increased to more than 90% from 77% in FY19. In the past, controlling shareholder Tata Trusts had expressed its displeasure over the low contribution of non-TCS entities to earnings. Non-TCS companies contributed Rs 1,683 crore to revenue, lower by 23%.
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