TCS Q3 results threw up positive surprise in terms of order booking and revenue: Omkar Tanksale – The Economic Times*

Clipped from: https://economictimes.indiatimes.com/markets/expert-view/tcs-q3-results-threw-up-positive-surprise-in-terms-of-order-booking-and-revenue-omkar-tanksale/articleshow/96860029.cms

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TCS Q3 results threw up positive surprise in terms of order booking and revenue: Omkar Tanksale

ET NowLast Updated: Jan 09, 2023, 07:12 PM IST

Synopsis

“The growth that they have shown in CC terms is definitely a well demonstrated execution part at such a kind of scale because they have ramped up the deals that they have won in the previous quarters and demonstrated the execution part well.”

“The margins are likely to be in line with the expectation with some sort of a moderation but the major things that one should look upon, the order book still remains strong. We were expecting some softening of the order book for the quarter but it looks to be strong at $7.8 billion versus $8 billion in the previous quarter,” says Omkar Tanksale, Equity Research Analyst, Axis Securities

What is your first reaction to

TCSNSE 3.38 % Q3 results? Revenues are higher than anticipated but what is your reaction to the operating margin of 24.5%?
This is much in line with the expectation. It is positive news in terms of revenue. It shows resilience in terms of the demand scenario. The margins are likely to be in line with the expectation with some sort of a moderation but the major things that one should look upon, the order book still remains strong. We were expecting some softening of the order book for the quarter but it looks to be strong at $7.8 billion versus $8 billion in the previous quarter. So, it is still a bigger positive surprise than expected.

The order booking is a positive surprise?
Yes, and also in terms of revenue.

Constant currency revenue growth at 2.2% is looking stronger than anticipated. Constant currency was expected 1.4%, it came in at 2.2%?
Yes, definitely. The growth that they have shown in CC terms is definitely a well demonstrated execution part at such a kind of scale because they have ramped up the deals that they have won in the previous quarters and demonstrated the execution part well and the demand still continues to be resilient in terms of digital transformation and Cloud transformation. Looking at the dependency on the IT services pack of all these businesses, it is likely to be sustainable in terms of going ahead even within the bad times or uncertainties.

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