133727In view of reduced inflation and expenses, will it be right to invest in IT stocks?

Tata Consultancy Services Ltd (TCS) has announced its final dividend for FY24 alongside its March quarter results on Friday, March 12, 2024. Investors were eagerly awaiting insights into the recovery of discretionary spends and IT budgets. The focus is on demand trends in key sectors like BFSI, Hi Tech, Manufacturing, Retail, and Communications, as well as the potential impact of the BSNL deal on margins and pricing dynamics.

Here are the highlights from the TCS Q4 results-

-TCS announced a revenue of Rs. 61,237 crore, reflecting a 3.5% increase year-on-year (YoY). Meanwhile, the revenue growth in constant currency terms was recorded at 2.2% for the quarter.

-The primary drivers of growth for the reported quarter were India (with a 37.9% increase), the UK (6.2% increase), and the manufacturing sector (9.7% increase).

-TCS saw a 150 basis points (bps) expansion in operating margins to 26% for the quarter, with net margins reaching 20.3%, up by 100 basis points.

-TCS recorded a net profit of Rs 12,434 crore, representing a 9.1% year-on-year (YoY) increase, attributable to the company’s owners.

– The company has proposed a final dividend of Rs 28 per share for eligible shareholders, pending necessary approval.

Here are the key highlights for the financial year 2023-24:

– TCS reported 62 clients with revenues exceeding $100 million, up from 60 in the previous year. Additionally, clients generating revenues in the range of $50 million increased by 6, totaling 139 for the year.

– As of March 31, 2024, TCS had a total headcount of 6,01,546 employees, representing 152 nationalities, with women constituting 35.6%. IT services experienced an attrition rate of 12.5%.

– The company amassed 5 million competencies through acquisitions, while the count of contextual masters reached 73,000.

– The free cash flow for the period amounted to Rs 44,282 crore.

– Shareholder payouts, comprising dividends and buybacks, totalled Rs 46,223 crore, as reported by the company.

“We are very pleased to close Q4 and FY24 on a strong note with the highest ever order book and a 26 per cent operating margin, validating the robustness of our business model and execution excellence, said K Krithivasan” Chief Executive Officer and Managing Director of Tata Consultancy Services.

“In an environment of global macro uncertainty, we are staying close to our customers and helping them execute on their core priorities with TCS’ portfolio of offerings, innovation capabilities and thought leadership,” he said.

On Friday, Tata Consultancy Services (TCS) shares closed at Rs 4000.30, marking a 0.45% increase for the day. The nation’s leading software exporter boasted a market capitalization exceeding Rs 14.45 lakh crore during that period.