Tata Group's largest company in terms of market value, Tata Consultancy Services (TCS) is set to reward its investors with yet another dividend payout. The IT behemoth will be announcing its Q4 along with full-fiscal FY24 earnings on April 12, 2024. On the same day, TCS will also take a call on the final dividend for FY24. Currently, TCS share is around Rs 3,915 level, and it is expected to hit a target of a whopping Rs 4,750 zone.
TCS Share Price:
TCS stock ended at Rs 3,915.25 apiece, up by 0.82% on BSE after market hours of April 1st. Its market cap is currently at Rs 14,16,571.72 crore.
This IT stock will be in focus this month in both pre-and-post Q4 earnings. The stock's 52-week high is at Rs 4,254.45, and its 52-week low is at Rs 3,070.30 apiece.
In a year, TCS's share price has gained by over 22% on BSE.
The next record high for TCS is expected to be Rs 4,750.
TCS Q4 Results:
As per the regulatory filing, TCS said, "A meeting of the Board of Directors of Tata Consultancy Services Limited is scheduled to be held on Friday, April 12, 2024, inter alia to:
- approve and take on record the audited standalone financial results of the Company under Indian Accounting Standards (Ind AS) for the year ending March 31, 2024.
- approve and take on record the audited consolidated financial results of the Company and its subsidiaries under Ind AS for the year ending March 31, 2024.
In Q3FY24, TCS logged a consolidated net profit of Rs 11,058 crore in, registering a growth of 1.95% year-on-year but a decline of 2.5% quarter-on-quarter. Consolidated revenue was at Rs 60,583 crore, which rose by 4.04% YoY and 1.49% QoQ. In constant currency, TCS revenue growth was at 4% YoY. While EBIT margin expanded by 50 bps to 25% in the quarter.
TCS Final Dividend:
Further, on April 12, TCS said that the board will be considering a final dividend, if any, on the equity shares of the Company for the financial year ending March 31, 2024, for the approval of the shareholders at the ensuing 29th Annual General Meeting.
Since 2023, TCS has paid a whopping 14,400% dividend amounting to Rs 144 per share. However, TCS has a long history of paying dividends to its shareholders.
As per Trendlyne data, TCS paid up to 83 dividends since October 2004. It currently has a dividend yield of 1.8%, one of the highest.
TCS Bonus Share:
Apart from dividend payments, TCS also holds a strong track of rewarding bonus shares. TCS paid 1:1 bonus shares each in July 2006, June 2009, and June 2018 respectively.
The company has not declared any stock splits.
Buy TCS Share Price:
In its latest research report, Sharekhan said, "TCS's resilient revenue growth over the last several quarters is expected to pick up, given the ramp-up of large deal wins over FY25/26 in addition to demand recovery across key verticals, including BFSI, led by mitigating headwinds in CY24 and growing opportunities across newer technology services. The ramp-up of JLR, Nest, BSNL and Aviva deals is likely to fuel revenue growth in the medium to long term.
Additionally, Sharekhan's note added, "TCS is witnessing a margin uptick aided by moderating attrition and declining subcon costs. Margin improvement is expected to steadily continue in FY25, aided by revenue growth, further moderation in LTM attrition, Subcon cost optimization, and improving utilisation. TCS's strong domain expertise, geographical presence, and ability to cross-sell make it well placed to tap into significant opportunities for growth in the tech sector owing to demand recovery along with cost takeouts as well as digital-transformation programs and vendor consolidation in addition to the demand for newer technology services.
On the valuation, Sharekhan added, "We maintain BUY on TCS with revised PT of Rs. 4,750 (the increase in PT reflects rollover of valuation multiple to FY26E EPS), as the company's strong domain expertise, geographical presence, and ability to cross-sell make it well placed to grab opportunities across cost optimisation, digital transformation, and newer technology services. At CMP, the stock trades at 29.1/24.8x its FY25/26E EPS."
From the current price level, there is the potential of more than 21% in TCS in the near term.
A part of the Tata Group, India's largest multinational business group, TCS has over 603,305 of the world's best-trained consultants in 55 countries. The company generated consolidated revenues of US $27.9 billion in the fiscal year ended March 31, 2023, and is listed on the BSE and the NSE in India. TCS' proactive stance on climate change and award-winning work with communities across the world have earned it a place in leading sustainability indices such as the MSCI Global Sustainability Index and the FTSE4Good Emerging Index.
Disclaimer: The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.
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