TCS vs Infosys: Q3 results on Thursday, January 11; earnings timings, previews & what to watch

Tata Consultancy Services Ltd (TCS) and Infosys Ltd -- the largest and the second-largest domestic software exporters, are all set to announce their December quarter results on January 11, Thursday. Along with its quarterly results, the board of TCS would also be considering paying interim dividend for FY24. Analysts are not expecting much from the quarterly results, given higher furloughs in the seasonally weak quarter, impact of wage hikes on margins and also status quo on the cautious commentaries. 

What to expect?

On year-on-year basis, Sharekhan expects Infosys to report 8 per cent drop in net profit while it sees the Tata group's TCS clocking 8.2 per cent profit growth. While both Infosys and TCS are seen reporting fall in YoY operating profit margin, Infosys' YoY margin fall could be to the tune of 100 basis points, Sharekhan said. Sequentially, TCS may report improved margin. In revenue terms, Infosys is seen reporting flattish sales while TCS could report 3.2 per cent rise in revenue in rupee terms, Sharekhan said.

"TCS is expected to report muted revenue growth at 0.3 per cent in CC terms due to furloughs offset by the contributions  from the BSNL deal. EBIT margins are likely to improve by 25 bps QoQ, aided by operating efficiencies partially offset by muted revenue growth," Sharekhan said adding that "Infosys is expected to report a revenue decline of 1.8 per cent in CC terms due to discretionary spend cuts and furloughs, with ~20 bps cross-currency headwinds. EBIT margins are likely to decline by 95 basis points QoQ due to wage hike and weaker revenues.

Axis Securities sees TCS to report 6.6 per cent YoY rise in profit at Rs 11,561 crore on 4.1 per cent rise in sales at Rs 60,594 crore. It sees order booking in the usual $7-9 billion range. It sees Infosys to log 7.6 per cent YoY drop in profit at Rs 6,087 crore on 1.4 per cent rise in sales at Rs 38,844 crore.

Watch to watch?

For TCS, BNP Paribas said it would watch out for the performance of BFSI vertical; medium-term industry demand trends and impact of macro headwinds on  demand. Besides, it would watch for commentary on the US and Europe markets and client budgets, deal wins and deal pipeline; investments  in GenAI partnerships and solutions, in addition to an update on the BSNL deal ramp-up.

This brokerage would like to hear on the performance of impacted verticals such as BFSI, retail, hi-tech and telecom; FY24 revenue and  margin outlook; risk of macro headwinds on demand and demand outlook and reason for cancellation of the $1.5 billion AI deal and risk of any other deal cancellations.

BNP Paribas said any commentary on core markets’ (US and Europe) performance and  client budgets; timeline of large deal win ramp-ups and pipeline; investments in GenAI partnerships and solutions would also be keenly watched. 

TCS Q3 results timing

In the case of TCS, the IT major would announce its results after market trading hours on Thursday. Its The leadership team will address the media in a Press Conference at 5:30 pm. The interaction will be telecast live on various business news channels and also streamed live on TCS' website and its YouTube channel.

TCS would later host an earnings conference call at 7:30 pm IST, during which the leadership team will discuss the financial performance and take questions from analysts.

TCS 3^rd interim dividend

The TCS board would also consider declaring interim dividend on Thursday. The third interim dividend, if declared, would be paid to TCS shareholders, whose names appear on the Register of Members of the IT firm or in the records of the depositories as beneficial owners of the shares as on Friday, January 19, 2024, which is the record date.

Infosys Q3 results timing

In the case of Infosys, the results would be announced around 3:45 pm IST. Infosys' leadership team will be part of a press conference at 4:30 pm IST and the participating executives will address questions from the media during this interaction, which will be streamed live on the Investor Relations section of Infosys website. The archive of the interaction will be available after 6:30 pm IST.

Later, Infosys would conduct a 60-minute conference call at 6:30 pm, where its senior management will discuss company's performance and answer questions from participants. This event, Infosys said, would be webcast live on the Investor Relations section of Infosys website, an archive of which will be available after 8:30 pm IST. 

 

Also read: Sarveshwar Foods shares surge 5% on securing GI tag

Also read: Hot stocks on January 9: YES Bank, Alok Textiles, Zee Entertainment, Capacite Infraprojects and more