India's largest tech player, Tata Consultancy Services (TCS) will declare its financial results for the June 2025 quarter on July 10. Apart from this, TCS' board members may also announce an interim dividend for FY26. In Q1FY26, TCS topline front is expected to be impacted due to a decline in BSNL earnings, while wage revision to put pressure on EBIT margins. However, deal wins are expected to be steady.
TCS Share Price:
At the time of writing, TCS stock traded at Rs 3,386.70 apiece, marginally up on the BSE, with a market capitalization of Rs 12,26,676.39 crore. The stock touched an intraday high and low of Rs 3396.75 apiece and Rs 3356.35 apiece in the early trade of July 10.
YTD, TCS stock dipped by nearly 18%.
TCS Q1 Results Preview:
"We forecast a revenue decline of 0.4% in c/c, led entirely by a decline in BSNL revenues. We forecast revenues of US$157 mn, down US$57 mn or 75 bps qoq. We forecast revenue growth of 0.3% in developed markets," said Kotak Institutional Equities analysts in their preview note.
On EBIT margins, they expect it to decline despite the deferral of wage revision normally scheduled in April of every year. The impact on margins is due to a lack of any leverage from growth.
Despite tailwinds from currency, EBIT margins are likely to remain flat quarter-over-quarter, according to Kotak's analysts, who predict TCS's deal wins to be steady at US$8-9 billion, flat year-over-year.
Meanwhile, analysts at Prabhudas Lilladher added, "We expect TCS revenue to report a decline by 0.9% QoQ CC due to the ramp down of the BSNL deal and weakness continuing in international business. We expect currency tailwinds of 170 bps leading to USD revenue growth of 0.5% QoQ. On the margins front, we expect the EBIT margin to decline by ~10 basis points, as lower third-party equipment costs will be offset by weak revenue performance. We expect deal wins to be steady in the band of USD7-9bn. Key monitorable will be outlook in the key geography of US & Europe and deal wins."
Also, analysts at Axis Securities expect TCS to report flattish revenue, i.e., 0.3% QoQ, led by revenue decline in the BSNL deal. EBIT margin to remain flat by 60 bps during the quarter.
Key Factors To Focus on for TCS Earnings:
In Axis Securities' view, key attributes to watch out for are a) Deal TCV/Pipeline, b) outlook on business vertical, c) wage hike, and d) New deal with BSNL.
Further, Kotak's analysts believe focus will be on the reasons for the struggle for growth in the international business despite strong deal wins. Client ramp-downs seem to have played a part in growth underperformance versus peers.
They added, "We expect investor focus on: (1) the impact of tariff uncertainty on demand across verticals, with special focus on manufacturing and retail verticals, (2) reasons for the underperformance in growth in developed markets, (3) outlook in financial services and healthcare verticals and any loss of share to insourcing at large clients, (4) reasons for weak margin performance; (5) impact of GCC ramp-up on growth of companies and GCC as a growth lever, (6) pace of adoption of enterprise GenAI adoption and its deflationary impact and (7) levers to defend and increase margins.
TCS' FY25 revenue stood at Rs 255,324 crore, registering growth of 6% YoY. In constant currency, the growth stood at 4.2% YoY. FY25 net profit came in at Rs 48,553 crore, rising by 5.76% YoY.
TCS Interim Dividend:
As per the regulatory filing, TCS will consider the declaration of an interim dividend to the equity shareholders in the meeting that will be held on July 10.
The interim dividend, if declared, shall be paid to the equity shareholders of the Company whose names appear on the Register of Members of the Company or in the records of the Depositories as beneficial owners of the shares as on Wednesday, July 16, 2025, which is the Record Date fixed for the purpose, it said.
This Tata tech giant holds strong record of dividend payout. Since October 2004, the company has delivered 90 dividends, as per Trendlyne data. In the past 12 months, the company has paid up to Rs 126 dividend per share. Its current dividend yield is at 3.72%.
Click it and Unblock the Notifications
Sign in with Google