Tata Consultancy Services is expected to report modest sequential growth in the March quarter, with margins seen improving on currency gains and cost actions, even as underlying demand remains mixed.
Key analysts consensus estimates tracked by Bloomberg indicate a 3% quarter-on-quarter rise in revenue, alongside a sharp increase in operating profit and net profit. EBIT margin is seen expanding to 25.04% from 20.12% in the previous quarter. Growth is expected to be supported by acquisitions and developed markets, while organic momentum remains muted and the BSNL extension deal has yet to contribute.
TCS Q4 Results Preview (Key Highlights) (Bloomberg Estimates)
- Revenue seen 3% higher at Rs 68,932 crore versus Rs 67,087 crore
- EBIT seen 30% higher at 17512 crore versus Rs 13498 crore
- EBIT margin seen at 25.04% versus 20.12%
- Profit seen 27% higher at Rs 13,581 crore versus Rs 10,657 crore
ALSO READ: TCS Dividend Announcement: What To Expect From The IT Behemoth On Payouts Ahead Of Q4 Results
Analysts expect growth to remain constrained despite steady deal wins. Focus will be on FY27 outlook, demand trends across BFSI and other key verticals, and commentary on artificial intelligence-led changes in delivery and pricing, along with the impact of macro conditions including developments in the US and the Middle East.
Here's what analysts are expecting from TCS Q4 results announcement:
Nuvama
- Expect 1.2% quarter-on-quarter growth in constant currency and 1.7% growth in US dollar terms.
- Growth seen broad-based across developed markets and rest of the world, with no contribution from the BSNL extension deal.
- Margins expected to remain flat, supported by currency tailwinds and offset by reinvestments and higher variable pay provisioning.
- Key focus on US macro outlook and updates on employee restructuring.
Citi
- Expects around 0.9% quarter-on-quarter growth in constant currency, with a cross-currency impact and some inorganic contribution.
- Margins likely to improve by about 45 basis points, aided by currency and prior headcount reductions, partly offset by investments.
- Deal total contract value expected in the $10–11 billion range.
- Focus on demand outlook, margins, deal wins, and performance in BFSI and retail verticals.
Goldman Sachs
- Growth expected to improve sequentially from Q3, supported by BFSI strength and inorganic contribution.
- Margins likely to benefit from currency movements.
- Headcount expected to remain broadly stable, with workforce rationalisation largely complete.
- Notes that growth in international markets may fall short of expectations.
Jefferies
- Revenue expected to grow about 1.0% quarter-on-quarter in constant currency, including inorganic contribution, with no BSNL impact.
- Margins likely to expand by about 80 basis points, supported by headcount rationalisation and currency benefits.
- Deal wins expected to remain in the $7–9 billion range.
- Key focus areas include demand in BFSI, North America and Europe, FY27 budgets, restructuring impact, BSNL ramp-up timeline and AI adoption.
JPMorgan
- Expect growth to stabilise as FY26 expectations bottom out.
- Margins expected to improve with restructuring of higher-cost resources.
- Sees earnings stabilisation from current levels, supported by cost actions.
UBS
- Growth expected to be supported by acquisitions, with organic growth remaining muted due to weakness in retail, life sciences and energy.
- Strength in BFSI, telecom and hi-tech expected to offset some weakness.
- Margins expected to remain largely flat, with currency benefits offsetting furlough impact.
- Deal wins expected in the $7–9 billion range.
Nomura
- Expect around 1% quarter-on-quarter growth in constant currency, driven by developed markets.
- EBIT margin expected to improve slightly as investments in AI continue.
- Deal wins expected to exceed $10 billion, supported by seasonally strong Q4.
- Key focus areas include restructuring impact, discretionary spending, AI impact, macro volatility and BFSI performance.
ALSO READ: IT Sector Q4 Results Preview: Growth Expected To Slow; AI, Macro Risks Likely To Cloud FY27 Outlook
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
