TCS shares fall nearly 3% after company's June quarter earnings fail to meet market expectations

New Delhi: Shares of Tata Consultancy Services (TCS) on Wednesday fell nearly 3 percent after the company’s June quarter earnings failed to meet market expectations. The scrip declined 2.87 percent to Rs 2,070.10 on the BSE. On the NSE, shares of the company fell by 2.90 percent to Rs 2,071.30.

“TCS’ Q1 performance was a tad weaker than our/street estimates,” according to a report by Emkay Global Financial Services. The country’s largest software services firm on Tuesday reported 10.8 percent growth in consolidated net profit to Rs 8,131 crore for the quarter ended 30 June. It had posted a net profit of Rs 7,340 crore in the year-ago period, the company said in a BSE filing. Revenue of the Mumbai-based firm grew 11.4 percent to Rs 38,172 crore in the June 2019 quarter, compared to Rs 34,261 crore in the same quarter of 2018-19, it added. “TCS’ Q1 FY20 result was a tad below estimates on both revenue growth and margins. The top-line miss was largely a consequent of incremental weakness in the BFSI vertical (31 percent of revenues) while margins were once-again affected by the continued increase in the fulfilment costs,” as per a report by JM Financial Institutional Securities. The board has recommended a dividend of Rs 5 per equity share for the June quarter.