TCS Q1 PAT may fall 3.6% at Rs 6112.8 cr: ICICIdirect

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26 Aug, 2025 12:21

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ICICIdirect has come out with its first quarter (April-June) earnings estimates for the technology sector. The brokerage house expects Tata Consultancy Services to report a 3.6 percent degrowth quarter-on-quarter (growth of 7.1 percent year-on-year) in net profit at Rs 6112.8 crore.Sales are expected to increase by 3 percent Q-o-Q (up 14.2 percent Y-o-Y) to Rs 29311.1 crore, according to ICICIdirect.Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to fall by 3 percent Q-o-Q (up 6.5 percent Y-o-Y) to Rs 7669.1 crore.ICICIdirect's Report on TCS:We expect TCS to post revenue growth of 3.5 percent in CC terms. Cross currency is expected to be a modestly larger tailwind at 70bps for TCS given its higher exposure to JPY and the 6.5percent Q-o-Q depreciation of JPY vs the USD in Q1FY17.We project USD revenue growth of 4.2 percent Q-o-Q – similar to Infosys. We expect EBIT margin to decline by 160bps Q-o-Q to 24.5 percent on account of wage hikes and visa costs partially offset by a richer business mix and operational efficiencies.We expect EBIT margin for FY17 to be 25.5 percent – lower than the 26-28 percent range guided by the company.Execution in digital revenues (up 14.8 percent Q-o-Q in Q4FY16) and BFSI (up 3.2 percent Q-o-Q in CC terms in a seasonally weak Q4FY16) would be closely watched.Commentary on Diligenta, Japan, Latin America and E&U will also be awaited as one or more of these segments have posed growth challenges in one or the other quarter for TCS in FY16.We project an EPS of Rs 31 in Q1FY17 – a Q-o-Q decline of 3.6 percent.Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.