MUMBAI: Smart traders and investors have pencilled in a 10% price range in software major Tata Consultancy Services (TCS), which kicks off the Q4 results on Monday. The share closed at Rs 3,686 at BSE on Friday.
The stock could trade between Rs 3,514 and R3,886 after the results.
That is Rs 186 movement up or down.
According to IIFL Research, the company is estimated to post a 2.9% sequential rise in revenue at Rs 50,326 crore, a 20 basis point Q-o-Q rise in operating profit margin at 24.9% and 2.2% jump in net profit at Rs 9,983.4 crore.
The Street will look out specifically for the nature and trajectory of deal wins, with short cycle deals likely to drive revenue growth.
Supply side pressure and robust employee hiring could impact the operating margin.
Any beat on estimates will drive up the stock. For instance, the Nifty has gained 13.5% from its March low through 17,784 on April 8. Over the same time the TCS stock has risen just 2.4%through Rs 3,686.
The company’s Rs 18,000 crore buyback offer which concluded last month was subscribed 7.5 times due to its attractive price at Rs 4,500 per share.
The stock at Rs 3,686 trades below its 50, 100 and 200 day moving averages, showing the Street preference for banking and metals rather than IT most recently.
Analysts expect that the beaten down IT sector could potentially start performing, depending on the performance of majors like TCS and Infosys this week.