Views on Tata Consultancy Services Limited Q2FY2018 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research- IT, Angel Broking):

"The company posted 3.2% sequential growth in USD revenues to US$4,739mn V/s US$4,738mn expected. On constant currency terms, the company posted a QoQ growth of 1.7%, driven by volume growth of 3.2% QoQ. In rupee terms, revenues came in at INR 30,541cr V/s INR 30,465cr, up 3.2% QoQ.

In terms of geography, USA (North America posted 1.4% QoQ CC, Latin America posted 5.7% QoQ CC), Europe (UK posted a 2.5% QoQ CC growth, Continental Europe posted a 5.3% QoQ CC growth), Asia Pacific posted a 3.0% QoQ CC growth.

In terms of verticals BFSI posted a 1.9% QoQ CC growth, Retail & CPG posted a dip of 0.9% QoQ CC, Communication & Media posted a 1.4% QoQ CC growth, Manufacturing a 1.9% QoQ CC growth, Life Sciences & healthcare posted a 3.6% QoQ growth, Energy & utilities posted a 7.2% QoQ growth, Travel & Hospitality posted a QoQ CC growth of 8.0%, Digital revenue posted a QoQ CC growth of 5.9%.

EBIT margin, came in at 25.1% V/s 24.1% expected, a QoQ expansion of 1.7%, much better than expected on back of good volume growth. In client additions, the company added clients $100M+ up by 1; $50M+, $20M+ & $10M+ each up by 6. Consequently, PAT came in at INR 6,466cr V/s INR 6,314cr expected, a rise of 8.8% QoQ. We maintain our NEUTRAL rating on the stock."

Shares of TATA CONSULTANCY SERVICES LTD. was last trading in BSE at Rs.2556.75 as compared to the previous close of Rs. 2548.55. The total number of shares traded during the day was 93513 in over 4662 trades.

The stock hit an intraday high of Rs. 2605.6 and intraday low of 2525. The net turnover during the day was Rs. 239719260.

Source : Equity Bulls

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