TCS Q2 results today, press conference doubtful after Ratan Tata's demise

Ratan Naval Tata, one of India's most influential industrialists and chairman emeritus of the Tata Group, passed away late Wednesday night at the age of 86.

In Short

• TCS Q2 earnings release set for today after market hours
• Press briefing post Q2 results unlikely after Ratan Tata's death
• Investors await insights on key sectors’ performance outlook

Following the news of Ratan Tata's demise, Tata Consultancy Services Ltd (TCS) is reportedly reconsidering its scheduled press conference for the announcement of its second-quarter earnings, originally planned for today. According to reports, the press conference and media interactions, which were set to take place later in the evening, may be cancelled, although there has been no official update from the company or on its website as of now.

Ratan Naval Tata, one of India’s most influential industrialists and chairman emeritus of the Tata Group, passed away late Wednesday night at the age of 86. He had been undergoing treatment for a prolonged illness at Mumbai’s Breach Candy Hospital. His death has left a deep void in India’s business world, with tributes pouring in from across the nation.

TCS is expected to release its financial results for the quarter that ended on September 30, 2024, after market hours today. In addition to the quarterly results, the board of TCS will also consider declaring the second interim dividend for FY25.

The leadership team of TCS was initially slated to hold a press conference at 5:30 pm to address the media about the company’s financial performance. This press briefing was scheduled to be aired live on several business news channels. Additionally, TCS had planned to host an earnings call at 7 pm, where its top executives were expected to provide further insights on the company’s performance and take questions from analysts and investors.

In light of Ratan Tata’s passing, the company's decision to proceed with these public engagements remains uncertain.

Despite the uncertainty surrounding the press conference, investors are keenly awaiting TCS’s results for the second quarter of FY25. Analysts and market participants are particularly focused on TCS’s demand outlook in key sectors such as software development services (SDS), transportation, and healthcare, as well as any updates on its business dealings with major clients like Jaguar Land Rover (JLR).

One area of interest is the commentary on the company’s engagements with clients beyond JLR in the transportation sector, as well as its outlook for the media and communications vertical. The healthcare and medical devices segment has also been under scrutiny, especially due to slower-than-expected growth in recent quarters.

In a pre-earnings report, Kotak Institutional Equities predicted that TCS would report a 9.9% year-on-year (YoY) rise in net profit, bringing it to Rs 12,461 crore. The brokerage also expects the company’s revenue to grow by 7.3% YoY, reaching Rs 64,040 crore for the September quarter.

"We forecast revenue growth of 1.2% constant currency (CC) quarter-on-quarter (QoQ), primarily driven by the transportation vertical. Despite moderating demand and delays in large projects, transportation should perform well, largely due to TCS's ongoing work with Jaguar Land Rover (JLR)," said Kotak Institutional Equities.

Kotak further noted that the media and communications sector is likely to experience steady performance, while the healthcare and medical devices segment may see a sharper revenue decline. These sectors are being closely watched as they have shown signs of underperformance in previous quarters.

Investors are also keen to hear from TCS about its plans for scaling up business operations in specific focus sectors. This includes not only transportation and healthcare but also the media and communications vertical, where clients have been cautious about increasing their spending.

TCS, one of the largest IT services companies in India, has historically delivered consistent growth. However, in recent quarters, it has faced challenges in ramping up deals in certain sectors like healthcare and media, as well as concerns about a slowing global economy affecting client spending.

As of now, with no official word from TCS regarding the status of its press conference or earnings call, the company's leadership team and investors will be keenly observing how today’s events unfold in the wake of Ratan Tata’s passing.