Centrum: TCS’ Margin Erosion Weighs On Profit After Tax
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Tata Consultancy Services Ltd.'s Q1FY21 results missed Centrum's estimates with a steeper disappointment on EBIT margin weighing on Profit After Tax. TCS cited that the worst impact of Covid is behind and guided for stabilisation and recovery in business. Company expects Q3FY21 revenues to be similar to Q3FY20 revenues in rupee terms.
While drop in utilisation rates (owing to ramp downs) weighed on Q1FY21 margins, we believe stabilisation in business could lead to a bounce back in margins from Q2FY21 onwards.
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