Q4 earnings: Who will prevail in the IT war between TCS and Infosys? What experts anticipate is as follows

TCS, Infosys Q4 profits: This month will mark the start of the fourth-quarter earnings season for TCS (Tata Consultancy Services) and Infosys, two of India’s leading software exporters. For IT companies, this quarter is predicted to be modest.

TCS is scheduled to present its fourth quarter results on April 12; Infosys is scheduled to release its results on April 18, according to an ET story.
In general, it is anticipated that IT businesses will perform modestly in the March quarter; no major shocks are anticipated.

According to Nuvama, the industry’s revenue growth would fluctuate between -1.5% and +4.5% due to the gradual reinstatement of furloughs and lower discretionary expenditure on technology.
But the main attention is on the advice for the current fiscal year (FY25), because most participants’ early projections for FY25 may be moderated given the dismal end to FY24 and an uncertain demand environment.

Expectations for TCS and Infosys’ Q4 earnings
With the BSNL acquisition supporting them, analysts predict that TCS will show industry-leading growth in the March quarter. Furthermore, it is anticipated that during the March quarter, the company’s constant currency sales growth would surpass that of its competitors on a sequential basis.
In the meantime, Infosys’s profitability from the first quarter of FY25 may start to rise due to projections of large ramp-ups in big engagements.
Kotak Equities has forecasted 1.7% quarter-over-quarter constant revenue increase for TCS in the next fourth quarter, while Infosys may see a 1.5% sequential dip.
For Infosys, the March quarter is often a bad one. Weak discretionary spending and lower revenues from third-party software sales are the predicted causes of the sequential dip.
It is anticipated that TCS would beat its counterpart located in Bengaluru in terms of margins, with a sequential increase probably supported by improved workforce utilisation and pyramid management.
Kotak predicts that the effect of pay adjustments and a lack of leverage from growth would cause Infosys’ EBIT margins to drop by 40 basis points.
It is anticipated that TCS and Infosys would win around $10 billion and $3 billion worth of deals, respectively, in the fourth quarter. TCS reported $8.1 billion in agreements during the December quarter, while Infosys scored significant deals of $3.2 billion.
Indian IT firms that provide yearly revenue growth guidelines, like Infosys, are probably going to take a conservative stance when issuing such standards. This concern stems from the persistent macroeconomic uncertainties as well as Accenture’s most recent projection reduction.
Nomura predicts that Infosys would guide for an EBIT margin range of 20–22% for FY25 and a 2-5% year-over-year sales rise in constant currency terms.

prognosis for stocks

The IT industry has had a great deal of volatility recently, with notable rallies in December and January and a dramatic drop in March.
Recently, CLSA India boosted the price targets for several of the front-runner IT companies and improved the rating of a handful of them. However, because of the unstable global climate, it is anticipated that the majority of enterprises would provide a cautious outlook.
TCS’s rating has been changed from “sell” to “underperform,” and the price target has been increased from Rs 3,925 to Rs 4,043. The firm has reduced the price objective for Infosys from Rs 1,741 to Rs 1,706, although it has kept its “outperform” rating on the company.