TCS Q2 FY24 Results HIGHLIGHTS: Tata Consultancy Services shares under pressure after IT major stages a mixed Q2 show
TCS Q2 Results HIGHLIGHTS: Tata Consultancy Services (TCS)—the country’s largest IT company—kicked off the corporate earnings season for India Inc on October 11, 2023. The Tata group IT giant reported a 2.4 per cent sequential increase in consolidated net profit to Rs 11,342 crore for the quarter ended September 30, 2023. Tata Consultancy Services' revenue grew 0.5 per cent to Rs 59,692 crore. While the software exporter's top-line stood almost in tandem with analysts' expectations, its bottom-line was clearly short of Street estimates.
The board of TCS gave nod to a share buyback worth up to Rs 17,000 crore at Rs 4,150 apiece, a premium of 15 per cent over the current market price. The board also approved a second interim dividend, of Rs 9 per share, for the financial year. TCS became the first Nifty50 company to report its financial results for the July-September period.
EDITOR'S TAKE | TCS futures have support in Rs 3,555-3,575 zone, says Anil Singhvi
Zee Business Managing Editor Anil Singhvi sees support for TCS futures coming in at Rs 3,555-3,575 levels and a higher zone at Rs 3,640-3,665 levels on Thursday.
Follow this space to catch all the latest updates on the TCS Q2FY24 results, and the views of Zee Business Managing Editor Anil Singhvi and other experts—and much more—only on the Zeebiz.com blog:
TCS Q2 Results HIGHLIGHTS: Tata Consultancy Services (TCS)—the country’s largest IT company—kicked off the corporate earnings season for India Inc on October 11, 2023. The Tata group IT giant reported a 2.4 per cent sequential increase in consolidated net profit to Rs 11,342 crore for the quarter ended September 30, 2023. Tata Consultancy Services' revenue grew 0.5 per cent to Rs 59,692 crore. While the software exporter's top-line stood almost in tandem with analysts' expectations, its bottom-line was clearly short of Street estimates.
The board of TCS gave nod to a share buyback worth up to Rs 17,000 crore at Rs 4,150 apiece, a premium of 15 per cent over the current market price. The board also approved a second interim dividend, of Rs 9 per share, for the financial year. TCS became the first Nifty50 company to report its financial results for the July-September period.
EDITOR'S TAKE | TCS futures have support in Rs 3,555-3,575 zone, says Anil Singhvi
Zee Business Managing Editor Anil Singhvi sees support for TCS futures coming in at Rs 3,555-3,575 levels and a higher zone at Rs 3,640-3,665 levels on Thursday.
Follow this space to catch all the latest updates on the TCS Q2FY24 results, and the views of Zee Business Managing Editor Anil Singhvi and other experts—and much more—only on the Zeebiz.com blog:
Latest Updates
TCS shares remain under pressure after IT major stages mixed Q2 performance
The Tata Consultancy Services (TCS) stock is trading with a cut of Rs 52.9, or 1.5 per cent, at Rs 3,557.3 apiece on BSE, having declined by as much as Rs 64.2, or 1.8 per cent, to Rs 3,546 apiece earlier in the day.
Image: BSEIndia.com
TCS Shares News | Tata Consultancy Services stock declined by Rs 50 in first few minutes of trade
TCS shares begin the day on a soft note, weakening by as much as Rs 50.2, or 1.4 per cent, to Rs 3,560.1 apiece on BSE.
The minor losses in the IT country are in contrast to a mildly positive start in both the benchmarks, which rise as much as 0.2 per cent in early deals.
The Sensex gains by 104.6 points to touch 66,577.6 at the strongest level of the session so far, and the Nifty50 climbs up to as high as 19,843.3, adding 32 points to its previous close.
TCS Shares News | Tata Consultancy Services shares down 0.7% at Rs 3,585 in pre-open market
The TCS stock settles weaker by Rs 25.2, or 0.7 per cent, at Rs 3,585 apiece in pre-opening trade on BSE.
Meanwhile, the 30-scrip Sensex index is up 91.5 points, or 0.1 per cent, at 66,564.6.
TCS Q2 Results | How brokerages view Tata Consultancy Services shares after September quarter results
| Brokerage | Rating | Price target | Upside/downside vs Wednesday's close (%) |
| Morgan Stanley | Equal-Weight | Reduced to Rs 3,590 from Rs 3,730 | -0.6 |
| Jefferies | Hold | Raised to Rs 3,690 from Rs 3,450 | 2.2 |
| Goldman Sachs | Buy | Raised to Rs 4,020 from Rs 3,970 | 11.4 |
| JPMorgan | Underweight | Rs 2,900 | -19.7 |
| Citi | Sell | Rs 3,170 | -12.2 |
| Nomura | Reduce | Reduced to Rs 3,030 from Rs 3,040 | -16.1 |
| HSBC | Hold | Reduced to Rs 3,625 from Rs 3,640 | 0.4 |
| Macquarie | Outperform | Rs 4,220 | 16.9 |
TCS Q2 Results | Anil Singhvi says buyback below expectations, margin & guidance strong
Zee Business Managing Editor Anil Singhvi has pointed out the following key points about the TCS earnings report:
Negative
- Buyback price and size below expectations
- Negative growth in dollar revenue
Positive
- Strong margins and guidance
- Strong new order win at $11.2 billion
TCS Q2 Results | Market guru Anil Singhvi sees support for TCS futures at Rs 3,555-3,575, higher levels at Rs 3,640-3,665
Zee Business Managing Editor Anil Singhvi suggests adopting a 'buy on dips' strategy on TCS shares after the IT major's earnings announcement.
He believes that the IT sector as a whole has begun the process of bottoming out.
TCS Q2 Results LIVE | Take a glance at IT major's segment-wise revenue
| Segment | Revenue (in crore rupees) | ||
| Q2 FY24 | Q1 FY24 | Q2 FY23 | |
| BFSI | 22,840 | 22,662 | 21,110 |
| Manufacturing | 5,787 | 5,636 | 5,170 |
| Consumer business | 9,773 | 9,876 | 9,240 |
| Communication, media & tech | 9,572 | 9,596 | 9,356 |
| Life sciences & healthcare | 6,625 | 6,636 | 5,999 |
| Others | 5,095 | 4,975 | 4,434 |
TCS Q2 Results LIVE | 'We continue to make investments in our people and new technologies,' says TCS COO
"We now have a 100,000-strong pool of Gen-AI Ready consultants and prompt-engineers who are engaged in hundreds of Gen-AI projects for our clients across segments," says TCS COO and ED N Ganapathy Subramaniam.
“During the quarter, BSNL awarded us the project to integrate and deploy a modern, indigenous pan-India 4G and 5G mobile network. This is a huge milestone for TCS, and we have commenced the supply, planning, design, installation and commissioning, and optimization of this mobile network, satisfying a detailed set of requirements conforming to 3GPP standards and the roll-out will be completed in about 18 months."
TCS Q2 Results LIVE | Attrition cools down to 14.9% | Catch key takeaways as India's largest IT firm kicks off corporate earnings season
Attrition rate
TCS' IT services attrition rate eases to 14.9 per cent on a trailing 12-month (TTM) basis, from 17.8 per cent in the previous quarter.
“Our focus on improving employee utilisation, while driving productivity improvement and cost efficiency across the organization, has helped us expand our operating margin... We will continue to push the growth, efficiency and innovation levers to further improve our profitability."
—Samir Seksaria, CFO, TCS
TCS Q2 Results LIVE | Gross additions below departures lead to easing of IT services attrition at TCS
The company says that its total workforce stands at 6,08,985, as of September 30. The gross additions being higher than departures reflect its focus on improving workforce utilisation and productivity, says TCS.
The Tata group IT major also says that its employee base remains "very diverse, with 35.8 per cent women and with 152 nationalities".
TCS Q2 Results LIVE | Here is a breakup of market-wise growth registered by the IT bellwether
| Market | Growth |
| United Kingdom (UK) | 10.7% |
| North America | 0.1% |
| Continental Europe | 1.3% |
| Middle East & Africa | 15.9% |
| Latin America | 13.1% |
| Asia Pacific | 4.1% |
| India | 3.9% |
TCS Q2 Results LIVE | IT major says its strategy of hiring bright freshers, investing in training them with right skills paying off
"With that talent coming on stream and with reduced attrition, we were able to recalibrate our gross additions, keeping it below the departures during the quarter, driving up productivity and enhancing project outcomes," says Milind Lakkad, Chief HR Officer, TCS.
TCS Q2 Results LIVE | TCS will continue to push growth, efficiency, innovation levers to further improve its profitability, says CFO Samir Seksaria
“Our focus on improving employee utilisation, while driving productivity improvement and cost efficiency across the organisation, has helped us expand our operating margin to 24.3 per cent," says Samir Seksaria, CFO, Tata Consultancy Services.
TCS Q2 Results LIVE | Strong deal momentum delivered us a very large order book, says Tata Consultancy Services CEO K Krithivasan
“Our clients continue to entrust us with critical new technology initiatives, and large programs to digitally transform their IT and business operating models. Strong deal momentum delivered us a very large order book in Q2–our second highest TCV ever in a quarter, and good pipeline," says TCS CEO and MD K Krithivasan.
"The resilience of demand for our services, our clients’ willingness to commit to long tenure programs and their continued appetite for experimentation with Gen AI and other new technologies give us confidence in our longer-term growth prospects," he adds.
Image: tcs.com
TCS Q2 Results LIVE | BREAKING—Tata Consultancy Services board approves Rs 9 interim dividend
The board of the Tata group IT major also approves a dividend of Rs 9 per equity share. This is a second interim dividend for the financial year.
The company has set October 19 as the record date for the payout.