NewsEarningsTCS, HCLTech shares fall marginally ahead of Q3 results; analysts predict slow growthTCS, HCLTech shares fall marginally ahead of Q3 results; analysts predict slow growth
TCS and HCLTech shares declined on January 12 ahead of Q3 results, with TCS falling 0.30% to ₹3,198.00 and HCLTech dropping 0.60% to ₹1,652.00. Analysts expect TCS revenue growth to slow to 4.20% YoY from 5.60% last year, while HCLTech is projected to report ₹33,046.00 crore revenue versus ₹29,890.00 crore previously. The IT sector faces headwinds from US demand weakness, proposed $100,000.00 visa fees, and client spending concerns, though AI momentum may build into 2026.
*this image is generated using AI for illustrative purposes only.
Shares of IT majors Tata Consultancy Services and HCLTech traded marginally lower on January 12 ahead of their December quarter results announcement. Both companies are scheduled to report their Q3 results in post-market hours, with analysts predicting muted performance amid challenging market conditions.
TCS Trading Performance and Analyst Expectations
India's top IT services exporter TCS saw its shares decline 0.30% to ₹3,198.00 at 11 am on January 12. The stock has faced significant pressure in 2025, falling 20.40% compared to a 12.50% decline in the IT index.
| Metric | Expected Q3 Performance | Previous Year |
|---|---|---|
| Revenue Growth (YoY) | 4.20% | 5.60% |
| Share Performance (2025) | -20.40% | -12.50% (IT Index) |
Ambit Capital has highlighted near-term risks to TCS' outlook for higher international market growth in FY26 versus FY25, citing elevated ask rates of 1.50% compound quarterly growth rate over the second half of FY26.
HCLTech Results Preview
HCLTech shares traded 0.60% lower at ₹1,652.00 in morning trade on January 12. According to LSEG data, analysts expect the company to report stronger revenue growth compared to TCS.
| Financial Metric | Q3 FY25 Expected | Q3 FY24 Actual |
|---|---|---|
| Consolidated Revenue | ₹33,046.00 crore | ₹29,890.00 crore |
| Share Performance (2025) | -15.00% | -12.60% (Nifty IT) |
Most brokerages do not expect HCLTech to upgrade its FY26 annual revenue forecast of 2.00% to 3.00% growth.
Sector Challenges and Market Dynamics
The broader ₹283.00 billion Indian IT industry continues facing multiple macro headwinds that are impacting sector performance. The IT index traded 0.60% lower in morning trade, reflecting widespread concerns across the sector.
Key challenges include:
- Uncertainty over US tariffs affecting client spending
- Proposed $100,000.00 visa fees creating operational concerns
- Subdued client spending amid growth worries in the US economy
- Tepid US demand and holiday-period client shutdowns
Future Outlook and AI Opportunities
Despite current challenges, there are emerging opportunities in artificial intelligence. Sector bellwether Accenture's recent earnings beat Wall Street expectations on AI-led demand, though its unchanged growth outlook underscores the cautious near-term environment.
While India has no pure-play AI firms, IT companies are beginning to shape AI strategies through acquisitions and partnerships. Brokerages expect AI momentum to build over the next six months, with demand potentially picking up into 2026.
The Indian IT sector's heavy reliance on the United States for revenue makes the world's largest economy crucial for sector performance, with companies earning a significant share of their revenue from US clients.
Historical Stock Returns for Tata Consultancy Services
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +0.22% | -1.10% | +0.21% | -4.99% | -20.40% | +1.21% |
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