TCS Q4 results today: Key things to watch out for
Tata Group-backed TCS will kick start the fourth quarterly earning season for India Inc today, April 12th with its financial results. The fourth quarterly results of FY23 is for the three-months period between January to March 2023. “The 4QFY23 earnings season begins this week with TCS due to report on Wednesday followed by Infosys on Thursday. Investors will closely watch out for management commentary on the demand environment for Indian IT services in the backdrop of the banking crisis and the slowing economic environment,” said Mitul Shah – Head of Research at Reliance Securities.
Hare key things to watch out for in TCS Q4 results today
1) Revenue growth: Analysts’ believe that overall growth for Q4 is expected to be less than Q3. Domestic brokerage and research firm Axis Securities expects TCS to report a revenue growth of 2.5 per cent quarter on quarter (QoQ) for the quarter ended March 2023.
2) Experts believe TCS may miss the EBIT margin target.
3) Hiring plan
4) Investors will be keenly eyeing the final dividend of TCS for fiscal year FY23.
5) Key bets and strategic direction under CEO designate K. Krithivasan.
6) The commentary around the BFSI sector will be closely watched after the collapse of Silicon Valley Bank (SVB), and Signature Bank of the US, followed by Switzerland’s Credit Suisse. BFSI accounted for over 38 percent of TCS’ revenue, as of the quarter-ended December.
J.P. Morgan recently said that TCS and Infosys Ltd have highest exposure to regional banks in the United States that are gripped under financial turmoil.
The IT index was the top sectoral loser, shedding 1.26%.
“The undertone of the market remains positive on expectation of healthy Q4 earnings, ahead of key macro data” said Siddhatha Khemka, head – retail research at Motilal Oswal Financial Services.
TCS Q3 results in December
In December 2022 quarter, TCS garnered a net profit of ₹10,846 crore attributable to shareholders on a consolidated basis up by 11.02% YoY and 3.98% QoQ. The net margin stood at 18.6% for the quarter, whereas the operating margin stood at 24.5% contracting by 0.5% YoY.
On the other hand, TCS consolidated revenue from operations came in at ₹58,229 crore increasing by 19.11% YoY and 5.28% QoQ. In terms of constant currency, the revenue growth was at 13.5% YoY driven by business in North America and the UK. TCS’ order book stood at $7.8 billion as of December 31, 2022, versus $8.1 billion in 2QFY23.
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