TCS profit up, Wipro flat: what India’s Q1 earnings reveal about a bigger shift

TCS’s profit rose about 5% to Rs 13,349 crore in the April-June quarter of FY27, while Wipro’s stayed flat at Rs 3,356 crore — modest numbers that reflect a broader trend across India’s IT services sector, where revenue is estimated to grow just 5%, driven largely by favourable currency movements as enterprises stayed cautious on spending. Infosys is due to declare its own results on 23 July.

The picture looks different elsewhere in India Inc. Ratings agency Crisil estimates overall corporate revenue will grow 11-11.5% in the quarter, with Sehul Bhatt, director-research at Crisil, saying the growth is being driven mainly by pricing rather than sales volume — a reversal from the pattern of the past two years.

India’s earnings season has been gathering pace through July, with Reliance Industries reporting on Friday and HDFC Bank, ICICI Bank and Kotak Mahindra Bank following on Saturday. Crisil said profits have grown consistently across companies that have reported so far, even though some missed analyst estimates. Automobiles, white goods, telecom, power generation, steel and healthcare all benefited from resilient domestic demand, with a spell of intense summer heat boosting demand for air conditioners after a rain-hit year earlier.

Tata Motors’ passenger vehicle business may report weaker results because of continued challenges at Jaguar Land Rover, while Hyundai could see some moderation, Crisil said. Construction is also lagging, with revenue estimated to rise just 1-3% as geopolitical disruptions delayed project execution despite healthy order books; L&T reports its Q1 FY27 numbers on 28 July.

Non-banking financial companies are entering the results season on firmer footing, with better margins and asset quality after a period of retail lending stress, in contrast to airlines, where rising aviation turbine fuel costs and softer passenger traffic are estimated to drag operating profit margin down by around 1,000 basis points.

Crisil expects overall corporate operating profit margin to contract by 75-100 basis points year-on-year, as companies absorbed part of the cost increases rather than passing all of it on. It flagged the balance between further price hikes and demand, cost recovery without losing volumes, and relief in fuel, freight and raw material pressures as the three factors that will shape earnings ahead, alongside the monsoon’s bearing on rural demand and food inflation.

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