Shares of Tata Consultancy Services today tanked more than 3 per cent on the courses on concerns there will a decline in its margin during the July-September quarter.
TCS in an analyst briefing with CFO and Executive Director S Mahalingam and Head of Investor Relations Kedar Shirali said that there might be a slight dip in margin during the second quarter of this fiscal year.
Shares of the company reacted to the development and slid 3.34 per cent during the day and fell to an intra-day low of Rs 1,296.10.
At the end of today’s trading session the stock was quoted at Rs 1,300.40,lower by 3.02 per cent from its previous closing price.
With the sharp decline in its stock price,the market capitalisation of the company fell by Rs 7,927 crore to Rs 2,54,517 crore from Rs 2,62,444 crore yesterday.
In the analyst call,TCS said that gains coming in from INR depreciation against the USD is likely to be absorbed by “fresher joining,ramp up of projects from India and APAC geography which are of lower margins and marginal shift to onsite for new deal starts.”
Meanwhile,TCS in the analyst meet also said that the management has decided to invest the benefits of rupee depreciation in pursuing lower-margin strategic deals that may not have met its margin threshold earlier.