TCS Q4 Results Preview: India's largest company, Tata Consultancy Services (TCS) share price dropped by 2% on BSE during Wednesday's trading session, ahead of its Q4 results for FY25. The Tata Group tech player will declare its quarterly report along with final dividend on April 10. In Q4FY25, TCS revenue is expected to be subdued in constant currency, while BSNL deal is likely to impact it. Deal wins are seen steady, however, the key focus area in TCS is the impact of international business and the outlook for FY26.
TCS Share Price:
At the time of writing, TCS's share price traded at Rs 3251.50 apiece, down by 1.3% on BSE, with a market cap of Rs 11,76,421.16 crore. The stock touched an intraday high and low of Rs 3276 apiece and Rs 3215.90 apiece respectively.
TCS Q4 Results Preview:
TCS has announced that a meeting of the Board of Directors is scheduled for Thursday, April 10, 2025. During the meeting, the board will consider and approve the audited standalone financial results of the Company under Indian Accounting Standards (Ind AS) for the financial year ending March 31, 2025. Also, consolidated financial results will be announced on Thursday.
In its preview note, Kotak Institutional Equities said, "We forecast flat revenues in c/c for the international business and a US$30 mn decline in BSNL revenues. The net result is a 0.3% decline in revenues in c/c. The benefit of rupee depreciation will be eaten away by promotions and investments in business, resulting in disappointing margin performance."
Further, the brokerage added, "We expect steady deal wins of US$11 bn. This is a decline from US$13.2 bn last year, which included certain large renewals."
Brokerage Sharekhan added, "TCS is expected to report revenue growth of -0.3% in CC due to ramp down in BSNL deal. EBIT margin is likely to improve by ~30 bps q-o-q, while deal wins are expected to be steady."
Meanwhile, brokerage Nuvama said, "Expect TCS to deliver -0.2% QoQ CC revenue growth and -1% QoQ USD decline due to ramp down in BSNL project - offset by strong rebound in developed markets. Margin to remain flat QoQ as BSNL tailwinds to come with a lag. We expect deal-wins to be stable. We will watch out for outlook on US macro amid the tariff uncertainty and margin recovery trajectory."
Among key focus areas, highlighted by Kotak are --- Focus will be on reasons for the struggle for growth in international business, which has been insipid due to ramp-downs and modest deal wins. We expect investor focus on: (1) the impact of tariffs and the recent chain of macro deterioration in the US on business and outlook for FY2026, (2) reasons for underperformance in growth in developed markets, (3) any projects cancellations or delays since January 2025 and its impact on FY2026 growth outlook, (4) outlook in the financial services vertical and any loss of share to insourcing at large clients, (5) state of spending in the UK and Europe markets and signs of improvement in demand, (6) impact of GCC ramp-up on the growth of companies and (7) levers to defend and increase margins.
During Q3 of FY25, TCS' reported consolidated net profit of Rs 12,380 crore in the third quarter ending period December 31, 2024, registering a growth of 11.95% YoY and 3.95% QoQ. Consolidated revenue from operations stood at Rs 63,973 crore in Q3FY25, higher from Rs 60,583 crore in Q3FY24, but marginally down from Rs 64,259 crore in Q2FY25. The company posted 4.5% YoY revenue growth in constant currency.
TCS Dividend:
The large-cap tech company will announce the final dividend for FY25 on April 10. Notably, TCS is a dividend king stock. Since October 2004, the company has distributed up to 88 dividends, as per Trendlyne data. In the last 12 months, the dividend payout was a whopping Rs 124 per share.
Unlike dividends, TCS has never carried a stock split but holds records of bonus issuance. TCS rewarded investors bonus shares of 1:1 each in July 2006, June 2009 and May 2018. However, that does not make TCS a bonus king stock, compared to its peers like Wipro who have rewarded more bonus shares. But TCS is definitely among the leaders in dividend rewards in the IT sector.
Should You Buy TCS Stock?
Kotak has recommended BUY on TCS ahead of its Q4 results, with a target price of Rs 4,100 per share. Sharekhan has picked TCS among its large-cap tech stocks ahead of Q4. Hence, Sharekhan has recommended BUY for a target price of Rs 5,230.
Brokerages like Motilal Oswal and Nuvama have also recommended BUY on TCS for a target prices of Rs 5000 and Rs 4,200 respectively.
Disclaimer: The write-up is just for information purposes, and is not a recommendation to buy, sell or hold. We have not done fundamental or technical analysis and have no opinion on the article mentioned. Neither, the author nor Greynium Information Technologies should be held liable for any losses. Please consult a professional advisor.
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