Tata Consultancy Services (TCS) will release its financial results for the quarter ending December 2015 on Tuesday, January 12. Here are 5 things to look out for in the IT company's result.
Revenue Growth and Operating Margin: TCS' revenue growth had been a disappointment during the last quarter, as it failed to meet analysts' expectations. However, the operating margin in Q2 improved by 78 basis points sequentially to 27.1%. IIFL estimates a 2.2% revenue growth in Q3 quarter-on-quarter.
Chennai floods impact: Incessant Chennai floods impacted the routine operations of the company for almost a week. It had to shut down its offices for more than three days and had to initiate the Business Continuity Plan in order to keep up with the critical operations. This resulted in the company issuing pre-results warning for the quarter ending December 2015. As per earlier estimates, IIFL had seen overall revenue of TCS to be impacted by 1 percent due to the Chennai floods.
Diligenta and decline in BFSI clients: At the Q2 earnings conference, N Chandrasekaran expressed concern over its Japan and Diligenta business stressing that Diligenta may decline further. Moreover the company’s inability get more business from big banks, as clients in banking, insurance and financial services is a matter to watch out for in this quarter.
Digital Space and Acquisitions: The company earlier said that it has built and deployed a new Learning Platform to enable Digital training for 100,000 employees for FY16. In the first quarter of this financial year, the company generated about 12.5% of revenue from client spending in the digital space. Last month, TCS signed close to $4 billion deal with Dell Inc for Perot Systems. Digital Space is expected to uplift TCS’s numbers in the last quarter.
Attrition Rate: The attrition rate (LTM) was at 16.2% including BPS. The company expects the attrition rate to come down in Q3.
No comments:
Post a Comment