Quarterly results are the overview of the firm’s performance during the last 3 months. It gives the investors an insight of whether they should keep their money in that company or increase their investment or move their money to other competitive stocks. Hence the companies give an overview of not only the performance for the last 3 months but also provide the information about the upcoming projects and changes made in the company to move forward. Currently the major tech companies of India Infosys and TCS have announced their results. Here we will not only mention their insights but also compare them side by side to get a better understanding between the tech gains and the tech sector in general.
Companies
The Tech giants Infosys and TCS together consist of 11% of the entire Nifty50 Index. The companies have failed to meet the estimates of analysts. They have been suffering less profits and not only are they also facing the crisis of the U.S. economy meltdown and banking failure. Hence in business slowdown tms the companies are facing revenue growth problems and are also posting unsatisfied results. Post the result announcements the Infosys ADR was seen down by almost 9%. This shows that in the market session of Monday one can witness a strong downsize in the prices of the tech giants.
Net Profit
The Net profit for Tata Consultancy Services increased to 14.8% then the previous year. However the company failed to meet the estimates by analysts at 11500 Crore Rs. On the other hand the net profit of Infosys was seen at 6128 Crore Rs which is 7.8% higher than the previous year’s figures. For Infosys as well the target set by analysts was 6613 Crore Rs which was not met by the company. Hence both the companies failed to achieve the estimated returns. On the top of that the margin of profit was less by 5% in TCS and almost 10% in Infosys. This triggers a wake up call for the people invested heavily in the tech sector. However in comparison TCS has given better expected returns that Infosys.
Revenue
The revenue for Tata Consultancy Services was seen up by 16.9% than the previous year. It was recorded at 59160 Crore Rs. On the other hand Infosys had a decreased revenue of 2.3% in comparison to the previous year’s figures. However for the fourth quarter the company produced a revenue of 37441 Crore Rs. The company also projected a growth of 4 to 7% in its revenue by the end of March 2024.
Dividend and Other Figures
The Tata Consultancy Board gave a dividend of 24 Rs per share. Infosys rolled out a dividend of 17.5 Rs per share. The top line and bottom line figures were below the analysts expectations for TCS. The growth was registered at 0.6% given the crisis across the U.S. For Infosys as well the Top line and Bottom line figures missed the Dalal Street expectations.
TCS had managed to win several large constructs this month. It includes a deal of above 700 Million dollars in the U.K. This has been the biggest deal of the company in the U.K market. The deal is with an insurance provider. The order book of TCS was around 10 Billion dollars in March which is 11.5% less than the previous year. The large deal value for Infosys was at 2.1 Billion Dollars.
Attrition
Tata Consultancy services has always been the leader in this segment. The company hired 821 employees and increased its overall strength to 6.15 Lakh People. The attrition rate of employees was up at 20.1% as compared to the previous year’s figure of 15.3%. The company has been outstanding on its hiring policies. It has already set up offers of 46000 in comparison to its projected figure of 40000 freshers. The salary of employees is assumed to get a 12 to 15% hike as per the Chief HR Officer.
The headcount of Infosys faced a reduction. Its headcount decreased by 3611 employees as compared to previous year’s figures. The net work force of Infosys stood around 3.43 Lakh employees. The attrition was seen at 20.9% against 24.3% in the previous year’s quarter.
Overview
Based on the figures it definitely seems that there is a slow growth rate expected in the tech segment. Also one can definitely say that Infosys will witness a speedy growth of share price in comparison to its peers once things turn out normal. The major reason behind this is its large digital footprint. If we look at the tech stocks then all of them have been down by more than 30% on average in comparison to their 52 week highs. Hence one can get a better return on investing in the tech sector but the waiting time is going to be huge.
