- Tata Consultancy Service (
TCS ) is all set to kickstart the corporate earnings season this Friday. - Rising visa and travel costs, along with supply chain pressures may eat into TCS margins.
- Multiple brokerages expect TCS’s net sales to be a little over ₹52,000 crore this quarter.
Wage hikes, currency volatility and a potential slowdown in international markets like US and Europe could impact the results of the Tata Group subsidiary, according to a report by Emkay published last month.
Increasing visa and travel costs, along with supply chain pressures, could also affect the operating margins.
Multiple brokerages expect TCS’s net sales to be a little over ₹52,000 crore in the first quarter of fiscal year 2023. The net profit expectations are in the range of ₹9,700 crore - ₹9,900 crore, as per Emkay Global, Edelweiss and Prabhudas Lilladher.
Motilal Oswal, on the other hand, expects TCS to cross ₹10,000 crore in net profit this quarter. The brokerage has recommended a buy on
The company had reported profit after tax of ₹9,926 crore on revenue of ₹50,591 crore in the January-March quarter. Overall, TCS had reported a revenue of ₹1.91 lakh crore and a net profit of ₹38,327 crore for the fiscal year 2022.
Investors will need to keep an eye on TCS’ deal momentum, tenure and pricing of contracts, attrition and supply-side pressure, Edelweiss said in a report. TCS’ comments on client budgets and the deal pipeline amid geopolitical uncertainties and a weak macro outlook would be key and will provide insights into the prospects for the entire India’s IT sector.
For the full year ending 2023, TCS is expected to post a net profit of over ₹44,000 crore on revenue of over ₹2.2 lakh crore, according to Emkay Global.
Note: ‘E’ stands for estimates
TCS shares have fallen 15% in value ever since the start of this year, and they closed at ₹3,265 on July 6. The company’s share price declined 13% in April-June 2022, performing better than the Nifty IT index’s 23.14% drop in the same period.
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