Tomorrow is a big day for Indian IT sector as Tata Consultancy Services (TCS), having rightly been qualified as the largest IT services company in the country, is set to come up with its financial results for the fourth quarter of FY24. Investors, associates, and other participants in the market will be closely watching the bellwether company of the IT sector as they will expect to learn how the industry fared in the recent months and will predict what the future holds.
The TCS has been witnessing volatility in terms of revenue in the past few years. However, there is a scope for optimism that the company will end the current fiscal year on a positive note. The experts, however, believe that the two wins, especially the big contract with the BSNL, would have given revenues a big push during the quarter even with challenges in some key markets abroad. TCS having been in position of what the growth rate of revenue was in terms of constant currencies is a positive message for the entire industry.
A key area of focus will be the performance of verticals like Banking, Financial Services and Insurance which saw some recovery signs. The manufacturing segment has also emerged as a bright spot driving new projects. Commentary around these sectors will offer clues to demand trends. Investors will be keen to understand if macro headwinds like inflation impacted discretionary technology spending during the period.
Another major announcement awaited is any change in TCS’ dividend policy which has rewarded shareholders handsomely so far. The company has a consistent track record of paying out a portion of profits each year and analysts feel it may continue this time as well. A stable dividend amid economic uncertainties would be welcomed by investors.
The management commentary and guidance for the new financial year will also provide valuable insights considering the mixed global environment. Any outlook on deal pipeline, currency fluctuations and investments in new technologies would be in focus. TCS’ ability to sustain growth momentum and maintain margins despite challenges will be under the scanner.
With TCS setting the tone for the quarter, broader insights into the IT landscape and demand drivers are expected. After years of leading from the front, can TCS keep its winning streak going? The results today will offer some key answers and set the stage for the sector as it embraces new opportunities and navigates headwinds in the year ahead.
TCS is set to announce its Q4 results for FY24 today. Key things to watch out are revenue growth driven by recent large deal wins including BSNL, recovery in BFSI and manufacturing verticals. Investors will also look out for any dividend announcement and management commentary on demand outlook and deal pipeline visibility for the new fiscal year. The results will provide a sense of the overall performance and direction of the Indian IT sector.
