India’s largest IT services company Tata Consultancy Services (TCS) will today, July 11, announce its financial results for the June 2024 quarter, at around 5:30 pm. The company does not provide revenue growth guidance, but investors will look at management commentary on the outlook. Here are important parameters the investors need to see in the results:
EBIT Margin
TCS’ EBIT margins are expected to contract by 150 basis points (bps) QoQ, owing to wage hikes in Q1FY25. A basis point is equal to a 100th percentage point.
Revenue Growth
According to a CNBC-TV18 poll, TCS is likely to register a quarter-on-quarter revenue growth of 1.5 per cent at Rs 62,170 crore, compared to Rs 61,237 crore in the March 2024 quarter.
“We expect TCS’s revenue growth to be sequentially in the lower single digits, led by contributions from recent deal wins,” Manish Chowdhury, head of research, StoxBox.
Growth in key verticals
TCS has higher dependence on the banking, financial services & insurance (BFSI) and the retail verticals than its peers in the industry, and its growth in these segments will be a key watch out for. BFSI contributes the highest about 31 per cent of the company’s total revenues, while retail accounts for about 14 per cent to the total revenue.
Management Commentary on Outlook
Management commentary on the outlook on demand environment would be key thing to watch out for. Outlook on near-term demand & pricing environment, BFSI, and deal wins are key monitorables.
Deal Pipeline
According to Motilal Oswal, the deal pipeline should remain healthy.
“The deal pipeline remains robust, focusing on demand recovery in the second half of FY25,” Stoxbox’s Chowdhury said.
Comments
0 comment