Published on 13/04/2019 10:09:44 AM | Source: HDFC Securities Ltd

In-line quarter, Deal wins surge - HDFC Securities

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Below is the views on In-line quarter, Deal wins surge by Mr. Apurva Prasad and Amit Chandra, IT analyst, HDFC Securities.

In-line quarter, Deal wins surge

TCS 4QFY19    

(M-cap Rs 7,556bn, CMP 2014, TP 2385, BUY)    

* TCS posted in-line revenue and margin performance, marked by strong deal wins. Revenue came at USD 5,397mn, 2.4/12.7% QoQ/YoY in CC terms (USD 5,408mn est) as compared to INFY’s 2.4/11.7% performance.    

* 4Q EBIT% came at 25.1%, -52bps QoQ (25.1% est and consensus at 25.5%), while INFY’s margin dipped 113bps QoQ. APAT came at Rs 81.26bn, 0.3/17.7% QoQ/YoY.    

* Key positives included (1) Strong deal wins (TCV of USD 6.2bn in 4Q vs. 4.9/4.9/5.9 in 1Q/2Q/3Q), (2) Strong traction in BFSI (vs. INFY) at 11.6% YoY CC, (3) Broad-based vertical performance, (4) Attrition in control, despite hyper-growth in digital services (31% of rev and 46% YoY), and (5) Moderation in sub-contracting exp. growth. Negatives include (1) Flattish large account performance (>USD 100mn dipped to 44) vs. surge in INFY. More details to follow post the con-call.


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