Q3 Results Preview: TCS, HCLTech Performance in Focus Amidst IT Sector Stability

• Q3 is seasonally weak for IT, but stability is expected, with subdued revenue growth due to holidays and fewer working days.
• A weaker rupee is anticipated to support margins and revenue for IT companies.
• Mid-cap IT companies may outperform large-caps, with the BFSI sector showing the most stability.
• TCS's Q3 revenue is estimated to be stable to slightly up, with potential flat to slightly lower margins due to seasonality and salary hikes.
• HCLTech's Q3 revenue is projected to increase, driven by product revenue, with a possible 50-75 Bps jump in margins despite salary hikes.

Why It Matters: IT sector faces seasonal weakness in Q3, but stability and rupee depreciation may support margins for TCS and HCLTech.