Tata Consultancy Services is likely to report a 5 per cent sequential jump in sales in the June quarter, which is traditionally considered to be a strong one for outsourcers. India's biggest IT services company's revenue is seen rising to $3678 million amid broad-based growth.
Tata Consultancy Services is likely to report a 5 per cent sequential jump in sales in the June quarter, which is traditionally considered to be a strong one for outsourcers. India's biggest IT services company's revenue is seen rising to $3678 million amid broad-based growth.
In rupee terms, TCS is expected to post a 2.9 per cent quarter-on-quarter rise in sales at Rs 22,044 crore, though operating margins are seen lower at 26 per cent as compared to 29.1 per cent in the previous quarter. Lower margins will translate into an 8.4 per cent q-o-q drop in net profits, which is seen at Rs 4,852 crore, according to analysts' estimates.
Wage hikes are likely to impact margins by 150-200 basis points, while rupee appreciation is expected to have a 100 basis point impact on margins, analysts polled by NDTV said. Operational efficiencies are likely to cap the impact of wage hikes and rupee appreciation though.
TCS had reported a profit of Rs 5,296 crore on sales of Rs 21,551 crore in the March quarter.
Last week, TCS' rival Infosys exceeded margin estimates, but disappointed with volume growth, which declined to 2.9 per cent in the April-June quarter from 4.1 per cent in the same quarter last year.
TCS does not put out an annual sales outlook, but is expected to grow above industry estimates of 13-15 per cent.
TCS shares closed 0.83 per cent lower at Rs 2,381.95 and underperformed the broader BSE IT sub-index, which rose 0.1 per cent.
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