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TCS profit misses estimates as recession fears hit IT spending.

TCS profit misses estimates as recession fears hit IT spending.

TCS profit misses estimates as recession fears hit IT spending.

On 8th July 2022, TCS announced the financial results for April-June 2022 quarter.
Tata Consultancy Services reported net income of Rs. 94.8 billion . While analysts predicted a net profit of Rs. 99.04 billion. Revenue from operations increased by 16% to 527.6 billion rupees and up by 4.3% QoQ to Rs. 52,758 crore during Q1FY23. However the operating profit margin slipped by 23.1% as against 25% in the previous quater. This was due the wage hikes and and the continued rationalisation of employee costs amid high attrition. The company recorded 5.2% rise in consolidated net profit at Rs. 9,478 crore on YOY basis.
The company has declared dividend of Rs. 8 per share. It will be credited by August 3, 2022, and the record date for the is July 16.
The Indian shares fell on Monday, as IT services major Tata Consultancy Services reported weak results last week.
On 11th July 2022, TCS share price opened lower at Rs. 3,226.15, while the previous closing price was Rs.3,265.45 on the BSE. The stock hit a high of Rs. 3116.40 and dropped by 4%. Currently the stock price is Rs. 3119.70 and down by 145.75 points or 4.46%. The market cap of TCS is Rs. 1,141,514 crore.

Most of the analysts have now revised downward TCS’s earnings estimates, due to fear of potential U.S. recession, forex volatility, and continued supply-side challenges. On the other hand, the company’s management is optimistic about future growth. According to the management the demand for technology remains ‘robust’. And the company has also not seen any footprint of the recession on the demand side. According to the chief executive officer and managing director Rajesh Gopinathan the company is seeing steady demand from immediate conversations with the customers. And the company is constantly polling to see if there are any early indications of softening .

The shares of TCS traded over the counter worth Rs. 15.9 crore i.e 0.5 lakh shares , compared with a two-week average volume of 0.76 lakh shares. The BSE Sensex was trading 324 points lower at 54,158 levels.

The shares of TCS traded lower than its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. TCS has recorded negative return of 2.5% in the past one year. This led to the underperformance of the BSE Sensex by 6%. The large cap stock is 3% away from its 52-week low of Rs.3,023.35 touched on June 17, 2022. The IT major hit a 52-week high of Rs. 4,045.50 on January 18, 2022.

 

TCS profit misses estimates as recession fears hit IT spending.
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RBI expects Inflation to cool from October.

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