Q2FY23 Preview: TCS: Revenues seen at Rs550,590 million, PAT at Rs104,153 million

10 Oct 2022 , 06:44 AM

Result date: 10^th October, 2022
Recommendation: Add
Target price: Rs3,450

India’s apex IT services company, Tata Consultancy Services (TCS), will report its results for the September 2022 quarter today. It is likely to put up a healthy show, reflecting the robust ramp up in deals.

Analysts at IIFL Capital Services forecast 4.0% sequential growth in constant currency revenues, led by previously-won deals and continued demand momentum for core transformation. They expect margins to expand by 90 basis points sequentially, due to absence of visa costs, absorption of wage hikes rolled out in Q1 and operating leverage.

Important management insights to watch out for:

·         Deal win momentum and nature of deals
·         Commentary on the impact of current macro on demand/decision-making
·         Supply-side (including attrition and hiring)
·         Potential impact of furloughs in Q3.
 

	September 2022 estimates	QoQ change	YoY change
Revenue (US$ mn)	6,900	1.8%	8.9%
Revenue (Rs. mn)	550,590	4.4%	17.5%
EBIT (Rs. mn)	131,919	8.3%	9.9%
EBIT margin	24.0%	90 bps	(160) bps
Profit After Tax (Rs. mn)	104,153	9.9%	8.2%
EPS (Rs.)	28.5	9.9%	9.4%

Source: IIFL Research