As the earnings season unfolds, Tata Consultancy Services (TCS) is gearing up to reveal its financial performance for the fourth quarter of the fiscal year. Anticipations are that this quarter will show modest results. A recent poll by CNBC TV18 predicts that TCS will report a profit of ₹12,546 crore and revenues of approximately ₹64,741 crore. The projected earnings before interest and taxes (EBIT) stand at ₹16,034 crore, signaling a cautious outlook for the IT giant.
Earnings Forecast and Market Insights
According to Kotak Institutional Equities, TCS is likely to experience stagnant revenue growth for its international business, coupled with a $30 million downturn in revenues from BSNL. They estimate a 0.3% decrease in revenues when adjusted for currency fluctuations. The anticipated benefits from currency depreciation may be offset by increased investments and promotions, leading to underwhelming margins.
- Key Insights:
- Expected deal wins: $11 billion, down from $13.2 billion last year.
- Focus areas include deal pipeline conversion, insights from retail and manufacturing sectors, and large deal ramp-up projections.
Upcoming Board Meeting Announcement
TCS has scheduled a board meeting on April 10, 2025, to discuss crucial financial matters. During this meeting, the board will:
- Review and approve the audited standalone and consolidated financial results for the year ending March 31, 2025.
- Consider recommending a final dividend for shareholders at the 30th Annual General Meeting.
Reviewing Previous Quarter Performance
In the previous quarter (Q3 FY25), TCS recorded a profit of ₹12,380 crore, reflecting a 12% year-on-year increase. Revenue from operations for that period reached ₹63,973 crore, marking a 5.6% rise compared to the previous year. Notably, TCS also declared a dividend of ₹76.00 per share, which included both a third interim dividend and a special dividend.
Latest Market Updates
As of the latest updates, JM Financial anticipates that the top six players in the IT sector will see a slight margin expansion of 10 basis points quarter-over-quarter. They noted that while TCS may benefit from currency fluctuations, the decline in BSNL revenues will likely necessitate reinvestments in talent and infrastructure.
- Projected Earnings for Q4:
- Revenue: ₹64,351 crore (up 5.1%)
- Profit: ₹12,356.7 crore (down 0.6%)
- EBIT: ₹15,711.6 crore (down 1.3%)
Conclusion
With TCS set to release its fourth-quarter results today, all eyes are on the IT services leader to gauge its performance amidst a challenging economic landscape. Stay tuned for insights, key metrics, and management commentary as we follow this developing story closely.
