TCS, Infosys Stock In News After Reporting Q3 Earning: Check What Expert Says On TCS, Infosys Stocks

New Delhi: IT company Infosys and TCS reported their FY24 third quarter earning on Thursday. Infosys posted a 7.3 percent decline in consolidated net profit at Rs 6,106 crore in the third quarter of the current financial year. Meanwhile, reported an 8.2 percent growth in net profit for the December quarter at Rs 11,735 crore.

A report by Reports by YES Securities has given BUY recommendation to Infosys, while for TCS it has maintained ADD recommendation.

Infosys Ltd (INFO IN)

Recommendation: BUY

CMP: Rs 1,494

Target Price: Rs 1,870

Potential Return: +25.2%

Yes Securities said Infosys Infosys reported broadly inline performance for the quarter. The revenue growth was above estimates; while EBIT margin was inline with expectation. It reported decrease in revenue by 1.0% QoQ in cc terms. Revenue decreased by 1.2% QoQ in USD terms (down 0.4% QoQ in INR terms). EBIT margin decreased by 71 bps QoQ to 20.5% on impact of wage hike during the quarter. Management has lowered FY24E revenue growth guidance to 1.5% to 2.0% in cc terms from earlier guidance of 1.0% to 2.5% on account of near term demand concerns. We maintain our BUY rating on the stock with revised target price of Rs 1,870/share at 22.5x on FY26E EPS. The stock trades at PER of 20.88x/18.0x on FY25E/FY26E EPS.

Tata Consultancy Services (TCS IN)

Recommendation: ADD

CMP: Rs 3,736

Target Price: Rs 4,175

Potential Return: +11.8%

Yes Securities said Tata Consultancy Services (TCS) reported inline operating performance for the quarter. It reported USD revenue growth of 1.0% QoQ (up 1.7% YoY in cc terms); while INR reported growth was 1.5% QoQ. The revenue growth was led by strong performance in Energy & Utilities (up 11.8% YoY cc terms) and Manufacturing (up 7.0% YoY cc terms). EBIT margin decreased by 83 bps QoQ to 23.4% led by seasonal furloughs. LTM attrition was down 160bps QoQ to 13.3%. We maintain our ADD Rating on the stock with revised target price of Rs 4,175/share at 25x on FY26E EPS. The stock trades at PER of 25.8x/22.4x on FY25E/FY26E EPS.