In Charts: How TCS And Infosys Fared In September Quarter
For TCS, India’s largest information technology company by market value, the quarterly performance was dragged down by banking, financial services, insurance and retail verticals, which reported muted growth on a sequential basis.
While the software services major informed investors that order booking in the second quarter remained at a multi-quarter high, it remained wary of revenue growth momentum in the second half of the ongoing financial year.
Infosys, on the other hand, did better than TCS in terms of sequential growth and margin expansion. The IT firm also raised the lower end of its growth guidance to 9-10 percent versus 8-10 percent earlier.
Here’s how TCS and Infosys fared in the September quarter:
Infosys and TCS posted lower sequential revenue growth in constant currency than Bloomberg consensus estimates of 3.5 percent and 2.5 percent, respectively.
While margin for Infosys expanded after five quarters, it narrowed to its lowest in nine quarters for TCS despite rupee depreciation and lower visa costs.
Infosys, with a bigger share of digital services in its revenue, registered higher growth in the segment than TCS.
The contribution of financial services was almost similar for TCS and Infosys, but Infosys posted a much higher sequential growth.
For Infosys, the domestic market posted the biggest year-on-year growth in constant-currency terms.
Infosys maintained its target of achieving operating margin of 21-23 percent while raising its lower end of guidance to 9-10 percent growth in constant-currency terms. TCS, however, doesn’t expect a robust expansion in margins as the IT firm will continue to invest in people in FY20.