TCS shares rally after June quarter profit climbs 17%, beats estimates

Shares of Tata Consultancy Services (TCS) soared as much as 3 per cent to hit an intraday high of Rs 3,360 on Thursday after the company reported a 17 per cent rise in quarterly profit, surpassing analyst estimates. The rise in the quarterly profit was on the back of large deal wins by TCS and was higher than the estimates by analysts, who predicted TCS to report a net profit of Rs 10,904 crore.

Strong Q1 earnings 

The information technology company's consolidated net profit climbed to Rs 11,074 crore in the first quarter of FY24, compared to Rs 9,478 crore in the same period a year ago. 

Highlights from the #TCSQ1 FY 2023-24 results. #BuildingOnBelief

— Tata Consultancy Services (@TCS) July 12, 2023

Revenue from operations of TCS was up by 12.55 per cent to Rs 59,381 crore against Rs 52,758 crore during the same period last year. Its revenue in constant currency terms advanced 7 per cent while the operating margin stood at 23.2 per cent.

"TCS reported an order book of 10.2 billion, reflecting a healthy pipeline of future projects. Additionally, its operating cashflows stood at Rs 11,535 crore, indicating the company's ability to generate substantial cash. TCS also declared a dividend of Rs 9 per share, providing an attractive return to investors," said Girish Sodani, Head of Equity Market at Swastika Investmart.

"TCS experienced a significant year-on-year rise in customers contributing $100 million, which demonstrates its ability to secure and expand valuable partnerships," he added. 

As of 10:40 am, shares of TCS were trading at Rs 3,352.45, 2.84 per cent higher than the previous close of Rs 3,259.90 on the NSE.