TCS Earnings: What's in store?

The earnings season was kicked-off by a robust performance by IT bellwether Infosys, which reported a much higher 6.9% qoq growth during Q2 FY16. All eyes now rest on other IT giant TCS, which is expected to post solid revenue growth of 5%+ qoq in constant currency (cc) terms.

The second quarter of a fiscal year has traditionally been the strongest period for India IT companies characterized by robust volume growth and significant margin expansion. However, the pervasiveness of this pattern would be challenged this time around due to prevalence of client, vertical or service line specific challenges for few industry players. So, the growth delivery could significantly vary across companies. A non‐operational growth headwind would be the adverse cross currency movement that is likely to have an impact of 0.4‐0.8% on reported numbers.   

The earnings season was kicked-off by a robust performance by IT bellwether Infosys, which reported a much higher 6.9% qoq growth during Q2 FY16. All eyes now rest on other IT giant TCS, which is expected to post solid revenue growth of 5%+ qoq in constant currency (cc) terms.

As per IIFL estimates, sales for TCS is expected to grow by 15.7% YoY and 7.4% QoQ to Rs. 27,560 crore. A strong and sizeable digital business and sustained impressive client mining will drive growth. Profit after Tax (PAT) is estimated at Rs. 6439 crore, surging 21% yoy and 12.1% qoq.

Tata Consultancy Services will announce its quarterly earnings in evening on October 13.

Stock Information

Tata Consultancy Services Ltd is currently trading at Rs. 2586.85, down by -5.55 points or -0.21% from its previous closing of Rs. 2592.4 on the BSE.

The scrip opened at Rs. 2605 and has touched a high and low of Rs. 2612.45 and Rs. 2568.05 respectively. So far 1284114(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs. 507773.39 crore.

The BSE group 'A' stock of face value Rs. 1 has touched a 52 week high of Rs. 2810 on 04-Mar-2015 and a 52 week low of Rs. 2348.25 on 16-Dec-2014. Last one week high and low of the scrip stood at Rs. 2725.4 and Rs. 2585.3 respectively.