Earning Estimates: TCS, HCLTech To Post Q3 Scorecard On Monday — What To Expect

Tata Consultancy Services Ltd. and HCLTech Ltd. will announce the financial results for the third quarter of the current financial year on Monday, Jan. 12. The earnings statements will be disclosed through the stock exchanges after market close.

TCS is expected to report higher revenue and profit in the October-December quarter, with margins seen expanding even as growth remains constrained by the BSNL ramp-down and the impact of wage hikes.

Bloomberg estimates point to a 2% sequential rise in revenue, alongside an 8% increase in both operating profit and net profit. EBIT margin is seen expanding to 25.02% from 23.45% in the previous quarter.

TCS Q3 Estimates (Consolidated, QoQ)

• Revenue 2% higher at 66,849 crore versus Rs 65,799 crore

• EBIT seen 8% higher at Rs 16,732 crore versus Rs 15,430 crore

• EBIT margin seen expanding to 25.02% versus 23.45%

• Profit seen 8% higher at Rs 13,006 crore versus Rs 12,075 crore

HCLTech is expected to report stronger sequential growth in the third quarter, with margins seen expanding on the back of software seasonality, even as wage hikes and restructuring costs weigh on profitability. Bloomberg estimates point to a 5% quarter-on-quarter rise in revenue and an 8% increase in operating profit.

HCLTech Q3 Estimates (Consolidated, QoQ):

• Revenue seen 5% higher at Rs 33,262 crore versus Rs 31,820 crore

• EBIT seen 8% higher at Rs 6,020 crore versus 5,562 crore

• EBIT Margin seen at 18.09% versus 17.47%

• Profit seen 11% higher at Rs 4702 crore versus Rs 4244 crore

Besides the headline numbers, markets will be parsing through segmental performance, activity in the important North American market, attrition rate, and management commentary on growth outlook.

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