While Chennai is just starting to recover from the recent floods, India's largest IT firm, Tata Consultancy Services (TCS), said that its third-quarter revenues will be significantly impacted by the worst floods witnessed in the city in nearly 100 years. TCS' earnings have already disappointed the Street's expectations in the past several quarters.
The Mumbai-based IT major, which employs over 65,000 people in Chennai, said employee attendance is lower than normal despite many of its facilities in the city started operating from 7 December.
"While majority of facilities in Chennai opened for normal business functioning on 7 December, 2015, attendance rates were lower than normal as employees were still recovering from the flood's aftermath," said TCS in a filing with the BSE.
"Chennai is one of TCS' largest delivery locations with over 65,000 employees," it said.
TCS said other than mission-critical activities, normal business functioning of its Chennai facilities had to be halted all week since December 1 due to the extreme weather conditions and flooding of the city after incessant rain.
"This is expected to have a material impact on the company's revenues in the seasonally weak third quarter ending 31 December, 2015," it said.
Earlier this week, the company said it had set aside Rs 1,100 crore for its flood-hit employees in Chennai.
Under the Rs 1,100-crore relief fund, the Mumbai-based IT major will extend interest-free cash advances to its employees advances "in the range of Rs 1 lakh and up to a maximum of equivalent to three months' gross salary."