TCS Reports Q3 Net Profit Of Rs 6,531 Crore

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New Delhi: India’s largest software services exporter TCS rose by about 14 percent in the calendar year 2017 and is all set to breakout in the year 2018, feel experts. The December quarter results might not be a blockbuster but any volatility could give long-term investors a buying opportunity.

TCS rallied by about 4 percent ahead of results on expectations of healthy results from the software giant. The stocks closed 3.6 percent higher at Rs 2,806, but the rally is not over a year, going by commentary from technical gurus.

The stock has shown a tendency of closing in red on the day of results in the last 12 months but gained post results. This bluechip stock has a long way to go and thus investors should use dips to enter the stock for long term.

Seasonal softness on lesser billing days and persistent weakness in select verticals may affect the numbers.

Brokerage Nomura India said while the company has been cautious on the BFSI space, it has been suggesting an improvement in the retail vertical and is confident on other verticals, too.
Performance and outlook for these segments would be keenly watched, it said.

For the quarter, the IT major may report a modest 1.1 per cent sequential revenue growth in dollar terms due to softness in banking and financial services (BFS) and retail verticals, and the fact the December quarter is a seasonally weak quarter for IT firms, Motilal Oswal BSE 0.99 % Securities said in a note.

“Our EBIT margin estimate for Q3 stands at 24.9 per cent, down 20 bps QoQ. This would be below the lower end of the guided range of 26-28 per cent for the fourth straight quarter. Our PAT estimate stands at Rs 6,390 crore, down 0.8 per cent QoQ, led by lower other income,” the brokerage said.

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