TCS Profit 'Largely Driven By Currency Depreciation', Not Growth: Piper Serica's Abhay Agarwal
Tata Consultancy reported results.
· NDTV Profit
TCS reported a 15% rise in net profit to Rs 13,884 crore for the quarter, with revenue up 11.2% to Rs 73,188 crore.
The analysis
Tata Consultancy reported Rs 13,884 crore and Rs 73,188 crore, with movement of 15% and 11.2% attached to those lines. Those are the figures as filed — what moves the price is how they sit against what the market already expected, not their absolute size.
Against that, the stock is +4.6% on the day at ₹2,171.50, and has returned +5.5% over three months. It sits 35% below its 52-week high, which means a good deal of bad news was already in the price. The it sector has moved +1.2% over the same period, so Tata Consultancy is running 4.3 points ahead of its peers.
For Tata Consultancy, the question is how much of this is already reflected in the price and how much re-rates the it peer set alongside it.
Why it matters
- Earnings versus expectations is what actually re-rates a stock; the surprise matters more than the absolute number.
Market context
- The company directly in focus is TCS.
- Sector exposure: IT.
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