TCS Q1 results today: IT belwether Tata Consultancy Services (TCS) will consider paying an interim dividend to shareholders on Friday, along with its April-June 2022 earnings. The interim dividend, if declared, will be paid to shareholders of equity whose names appear in the register of the members of the company or in the registers of the custodians as beneficial owners of the shares on Saturday, July 16, 2022, that is the record date set for the purpose, TCS said in a communication.
In 2021-2022, TCS had returned Rs 31,424 crore in cash to shareholders through buybacks and dividends. And in the quarter from January to March, it had announced a final dividend of Rs 22 per share.
What does D-Street expect?
According to analysts, the IT major is reporting a double-digit increase in year-over-year profits on revenue growth of more than 15 percent. Margins are shrinking due to wage increases. The total contract value is seen at $9-10 billion.
Motilal Oswal Securities sees TCS up 11.2 percent yoy (0.9 percent qoq) in adjusted net profit at Rs 10,050 crore. Prabhudas Lilladher expects adjusted profit to rise 10.7 percent year-on-year to Rs 9,968 crore. Emkay Global sees the PAT for TCS rise 10.5 percent year-on-year to Rs 9,958 crore. Edelweiss expects profits to rise 7.4 percent year-on-year (2.2 percent quarter on quarter) to Rs 9,703 crore.
In rupee terms, Prabhudas Lilladher expects a 16.3 percent year-over-year revenue increase from Rs 52,791 crore
Motilal Oswal said the EBIT margin could shrink to 23.9 percent in the June quarter, from 25 percent in the March quarter and 25.5 percent in the June quarter of last year, amid wage increases and ongoing pressure on the economy. the supply side. Prabhudas Lilladher sets TCS’s Ebit margin at 24 percent. Emkay sees the EBIT margin decline by 150 basis points due to wage increases and rising travel and visa costs. Phillip Capital said margins could fall 140 basis points sequentially. This brokerage also suggested wage increases, travel expenses and supply-side pressures, which should be partly offset by the depreciation of the rupee.
Should investors buy, hold or sell?
Despite expectations of a strong quarterly show, the stock is under selling pressure late. In the past three months, the amount of money has fallen by just over 10 percent, data shows. It closed 0.8 percent higher on Thursday, a day ahead of the results.
Anand James, Chief Market Strategist at Geojit Financial Services, said: “Traders can bet Naked call or bull spread, preferably with puts. TCS started to shake off the 1st half bearishness and has consistently closed above or close to the 20d SMA for the past 10 days. For the past two months in a row, we’ve seen a short build along TCS’s futures, but the short cover is now visible, outperforming both Nifty and the IT index as it jumped from the recent June 17 low. Thursday’s OI spectrum shows options traders have repositioned their bias and become more optimistic, with PEs seeing a short build and many OTM CEs a long build. The new additions to CEs suggest a 3.5 to 8 percent increase in TCS before its July expiration.
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