TCS trades flat post Q2 results

The stock was trading flat at Rs 2,336 on BSE, as compared to 0.20% fall in the S&P BSE Sensex at 09:56 am.

Tata Consultancy Services (TCS) has moved higher by 2.4% to Rs 2,384, recovering nearly 4% from intra-day low on the BSE.

The stock of information technology (IT) major hit an intra-day low of Rs 2,299, down 1% against Thursday’s close, after the company posted 0.3% sequential growth in USD revenues to US$ 4,374 million for the second quarter ended September 30, 2016 (Q2FY17).

At 09:56 am, the stock was trading flat at Rs 2,336 on BSE, as compared to 0.20% fall in the S&P BSE Sensex. A combined 2.18 million shares changed hands on the counter on the BSE and NSE so far.

While TCS beat estimates on margin and net profit growth, but missed expectation on topline growth.

 

The company’s consolidated net profit grew 4.3% quarter-on-quarter (QoQ) to Rs 6,586 crore. Revenue rose 0.1% at Rs 29,284 crore sequentially. The operating profit margins up 94 basis points sequentially to 26%.

Analysts on an average had expected profit of Rs 6,315 crore on revenues of Rs 29,726 crore.

“It has been an ‘unusual Q2’ for TCS. Growing uncertainties in the environment are creating caution among customers and resulted in holdbacks in discretionary spending this quarter. We had said that BFSI (banking, financial services and insurance) spend will be soft and that has pretty much played out. In India, we saw a surprise, in term of postponement of some key orders to the extent of Rs 180 crore, which we expect to come in Q3. Then in Britain, we saw softness in retail, more in the UK and somewhat in the US,” said N Chandrasekaran, managing director and chief executive officer, TCS.