TCS Q1 Review – Robust Core Growth, Deal Wins To Drive Expansion: Motilal Oswal

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Tata Consultancy Services Ltd. reported revenue growth of 2.4% QoQ constant currency in Q1 FY22, below our estimate of 3.6%.

This was primarily due to sharp de-growth in its India business (down 14.1% QoQ) on account of the second Covid-19 wave.

Excluding the impact in regional markets, core business growth of 4.1% QoQ constant currency was broadly in-line.

The Ebit margin at 25.5% (marginally above our estimates) declined 130 basis point QoQ, primarily due to annual wage hikes (170bp impact).

The company delivered another quarter of strong deal wins ($8.1 billion), with a book-to-bill ratio of 1.3 times, despite the absence of any mega deals.

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Motilal Oswal TCS Q1FY22 Results Update.pdf


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