A day after announcing corporate India's biggest employee bonus, TCS takes a hit where it hurts- its balance sheets

Just a day after announcing India’s largest employee bonus ever, Tata Consultancy Services Ltd (TCS) posted one of its worst quarter performances ever on Friday morning, thereby slipping as much as 4.35% and was trading below its 200-DMA in trade on the Bombay Stock Exchange. The IT major’s TCS revenues took a hit of nearly 1 per cent per cent in the quarter on account of cross currency movements.

TCS was the top percentage loser on both Sensex and Nifty. It plunged as much as 4.3 per cent on the NSE to hit Rs 2,470, its lowest level since February.

The company reported an adjusted net profit of Rs 3,712.7 crore after adjusting for one-time bonus to employees of Rs 2,628 crore. An Economic Times Poll had estimated a net profit of Rs 5,396.3 crore.

Revenue in rupee terms increased to Rs 24219.8 crore, while in dollar terms it came at $3900 million, ​against the ET Now poll which estimated it at Rs 5,396.3 crore. TCS reported a net profit of Rs 5,773 crore, up 8.4 per cent, on quarter-on-quarter (QoQ) basis

Volume growth was disappointing at 1.42 per cent, Q-o-Q against Street expectation of 2.5 per cent. The EBIT margin in Q4 stood at 27.2 per cent; post staff bonus is stands at 16.4 per cent.

At 10:00 a.m.; TCS was trading 4.07 per cent lower at Rs 2478. It hit a low of Rs 2472.50 and a high of Rs 2561 in trade today.

"Tata Consultancy Services Q4FY15 results were mixed bag. Revenue was below PLe/Consensus expectation, but, margin (after adjusting for employee bonus of $423m) was ahead of expectation. TCS missed expectations in five out of last six quarters," said Prabhudas Lilladher report.

"The weakness was attributed to disappointment in Telecom, Insurance and Energy. Management continues to hold its positive view on demand environment and IT budget. We expect near-term weakness in stock price as consensus expectations moderate," the report added.

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