Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
India IT Services: Expect good June-11 quarter results and commentary from large caps with TCS continuing
to lead
We expect the June-11 quarter to be strong for TCS, HCLT and even Infosys, but weak for Wipro. We expect
TCS to once again lead the sector with US$ revenue growth (Q/Q) of ~6.5%, and estimate growth of 5%-6% for
Infosys/HCLT. Notably, we expect cross-currency to add 0.5%-0.7% to all four companies’ growth.
We estimate Infosys’ and TCS’ EBIT margins to fall 150 bps and 120 bps Q/Q, respectively, due to annual wage hikes
effective April. We forecast margin expansion of 100 bps Q/Q for HCLT to meet its 4QFY11 EBIT margin target of
15.3% (ex ESOP cost). Wipro’s IT services margins should remain flat (22%) as wage hikes take effect one quarter
later (July).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
India IT Services: Expect good June-11 quarter results and commentary from large caps with TCS continuing
to lead
We expect the June-11 quarter to be strong for TCS, HCLT and even Infosys, but weak for Wipro. We expect
TCS to once again lead the sector with US$ revenue growth (Q/Q) of ~6.5%, and estimate growth of 5%-6% for
Infosys/HCLT. Notably, we expect cross-currency to add 0.5%-0.7% to all four companies’ growth.
We estimate Infosys’ and TCS’ EBIT margins to fall 150 bps and 120 bps Q/Q, respectively, due to annual wage hikes
effective April. We forecast margin expansion of 100 bps Q/Q for HCLT to meet its 4QFY11 EBIT margin target of
15.3% (ex ESOP cost). Wipro’s IT services margins should remain flat (22%) as wage hikes take effect one quarter
later (July).
No comments:
Post a Comment