TCS shrugs off weak quarterly forecast

TCS rose 1.89% to Rs 2256.60 at 9:17 IST on BSE after the company said that the appreciation of the rupee against the dollar will adversely impact the company's EBIT margin by about 100 basis points in Q1 June 2014.

The announcement was made after market hours on Friday, 13 June 2014.

Meanwhile, the S&P BSE Sensex was down 32.09 points or 0.13% at 25,196.08.

On BSE, so far 5,375 shares were traded in the counter as against average daily volume of 1.01 lakh shares in the past two weeks.

The stock hit a high of Rs 2,251.20 and a low of Rs 2,215 so far during the day.

TCS on Friday, 13 June 2014, said that the appreciation of the rupee against the dollar will adversely impact the company's EBIT margin by about 100 basis points in Q1 June 2014.

This is based on the rupee movement so far during the quarter and these estimates could change depending on the rupee movement in June. TCS also said that annual salary increments will adversely impact profit margin in Q1 June 2014 which is in line with and proportionate to impact seen in earlier years. TCS also said that other income in Q1 June 2014 will be in line with expectations.

TCS also said that there will be one-time additional depreciation charge of about 2% of fixed assets in financial results as per International Financial Reporting Standards (IFRS) due to a change in depreciation policy. There will be a write back of depreciation of 4% to 5% of fixed assets in consolidated results as per Indian accounting standards due to the change in depreciation policy.

TCS said that there is no change in revenue outlook issued at conference call held after announcing Q4 March 2014 results in April 2014. The TCS management had at that time said that the company was upbeat that the next 12 months will bring many more opportunities for growth across multiple industries and markets.

TCS' consolidated net profit rose 2.3% to Rs 5297 crore on 1.2% growth in revenue to Rs 21551 crore in Q4 March 2014 over Q3 December 2013.

TCS is an IT services, consulting and business solutions organization that delivers real results to global business, ensuring a level of certainty no other firm can match. TCS offers a consulting-led, integrated portfolio of IT, BPS, infrastructure, engineering and assurance services.

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