TCS will announce fourth quarter earnings tomorrow. here’s what to expect

Last week, on Friday, TCS Shares held steady and ended at 3686.85 marginally up from the previous close on the BSE. The market valuation of TCS is over at the closing stock price 13.49 lakh crore.

In the past week, shares of TCS have declined roughly 2% as focus shifts to fourth-quarter and year-end performance for FY12.

For TCS’s fourth quarter, analysts Manik Taneja and Dimel Francis of JM Financial said, “We are building in a 3.5% QoQ c/c growth with a ~60 bps cross-currency headwind. 20 bps QoQ in EBIT margin Slight improvement is expected at Rs.25.2% aided by growth leverage and modest INR depreciation.”

According to analysts at JM Financial, the key points to note are – CY22/FY23 client spend outlook; Margin performance and outlook, especially given a possible recovery in travel and supply side pressures; and outlook on pricing.

JM Financial Analysts expects TCS’s revenue to grow 12% year-on-year and 2.9% quarter-on-quarter to $6,712 million. In rupee terms, the revenue is expected to be 50,676.2 crore growing at 16% yoy and 3.7% qoq. Meanwhile, the net profit is looked at 10.065,6 crore grew 8.9% year-on-year and 3% on a quarter-on-quarter basis. As far as EBIT is concerned, it is seen here 12,766.6 crore is up 8.8% year-on-year and 4.3% quarter-on-quarter. EBIT margin is estimated at 25.2%, shrinking 170 basis points year-over-year, but improving by 20 basis points on a quarter-on-quarter basis.

On TCS share outlook, JM Financial gives ‘Hold’ recommendation with analysts’ target price 4,100 per.

TCS hits 52-week high on BSE Currently 4,045.50 each.

During Q3FY22, TCS reports 12.3% year-on-year growth in consolidated net profit 9,769 crore with a net margin of 20%. Consolidated revenue jumped 16.3% year over year 48,885 crores. Consistent currency revenue growth stood at 15.4% year-on-year.

In the December 2021 quarter, all TCS verticals grew in the mid to high teens. Retail and CPG (20.4%), BFSI (+17.9%), and manufacturing vertical (+18.3%) led the growth. Technology & Services grew by +17.7%, Life Sciences & Healthcare grew by +16.3% and Communication & Media grew by +14.4%.

In addition, TCS crossed a new milestone in the third quarter with the number of women in its workforce crossing 2 lakh. TCS added 28,238 employees on a net basis, taking the total workforce to 556,986 as of December 31, 2021. The attrition rate (LTM) for IT services was 15.3% in the third quarter.