Ratio Analysis of IT sector

Companies
Group No. 04
 IT-Software Industry
• The Indian Information Technology/ Software industry is a global
powerhouse today, and its impact on India has been incomparable.
• The software industry includes businesses for development,
maintenance and publication of software that are using different
business models, mainly either "license/maintenance based”or "Cloud
based”.
• The industry also includes software services, such as training,
documentation, consulting and data recovery.
 Infosys Limited
• Infosys Limited is an Indian multinational information technology
company that provides business consulting, information technology
and outsourcing services.
• Infosys provides software development, maintenance and independent
validation services to companies in finance, insurance, manufacturing
and other domains.
• The company has market presence in the Americas, Europe, the
Middle East, Africa and Asia-Pacific. Infosys is headquartered in
Bengaluru, Karnataka, India.
 Accenture
• A global professional services leader, empowering businesses with
innovative solutions worldwide.

• Operating in 120+ countries, they leverage technology, strategy, and

consulting to drive growth and transformation.

• With a strong focus on sustainability, Accenture is a trusted partner,

shaping the future of industries across the globe.
 Tata Consultancy Services(TCS)
• Tata Consultancy Services is an IT services, consulting and business
solutions organization that has been partnering with many of the
world’s largest businesses in their transformation journeys for over
55 years.
• A part of the Tata group, India’s largest multinational business
group, TCS has over 614,000 of the world’s best trained consultants
in 55 countries.
• The company generated consolidated revenues of US $27.9 billion
in the fiscal year ended March 31, 2023, and is listed on the BSE
and the NSE in India.
 Eclerx Services Ltd.
• Eclerx Services Ltd. is an Indian IT consulting and outsourcing
multinational company based in Mumbai and Pune.
• This company engaged in providing solutions to Fortune 500
companies business process management, automation and analytics
services .
• Eclerx is a public limited company whose shares are listed on the
Bombay Stock Exchange and National Stock Exchange of India.
 Tech Mahindra
• Tech Mahindra is an Indian multinational technology company
headquartered in Pune.
• Established in 1986 as a joint venture between Mahindra &
Mahindra and British Telecom, it specializes in providing
information technology services and solutions.
• With a strong focus on digital transformation, cloud services, and
consulting, Tech Mahindra serves clients from various industries
worldwide.
• As of my last knowledge update in September 2021, its turnover was
around $5.1 billion.
 Current Ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 1.81 2.00 2.54 2.62 2.84
TCS 2.53 2.56 2.91 3.33 4.18
Accenture 1.43 1.29 1.25 1.49 1.40
Eclerx Ltd. 3.92 4.12 4.21 5.10 7.84
Tech Mahindra 1.81 2.56 3.36 3.16 2.28

Interpretation:
 Quick Ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 1.81 2.00 2.54 2.62 2.84

TCS 2.53 2.56 2.91 3.33 4.18

Accenture 1.43 1.29 1.25 1.49 1.40

Eclerx Ltd. 3.92 4.12 4.21 5.10 7.84

Tech Mahindra 1.81 2.56 3.36 3.16 2.28

Interpretation:
 Debt Equity ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 0.00 0.00 0.00 0.00 0.00
TCS 0 0 0 0 0
Accenture 0 0 0 0 0
Eclerx Ltd. 0 0 0 0 0

Tech Mahindra 0.00 0.00 0.00 0.00 0.01

Interpretation:
 Debt to Total Assets ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 0.00 0.00 0.00 0.00 0.00

TCS 0 0 0 0 0

Accenture 0 0 0 0 0

Eclerx Ltd. 0 0 0 0 0

Tech Mahindra 0.00 0.00 0.00 0.00 0.00

Interpretation:
 Interest Coverage Ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 108.82 140.08 126.27 113.96 0.00
TCS 69.62 61.80 66.69 41.75 189.14
Accenture 153.82 96.32 143.34 235.70 254.47
Eclerx Ltd. 2308.45 -68.09 -23.10 -21.23 -23.54
Tech Mahindra 54.42 143.92 134.42 114.96 182.36

Interpretation:
 DSCR Ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 91.25 117.64 106.07 99.41 0.00

TCS 81.50 73.80 78.99 51.54 222.30

Accenture 158.43 102.72 162.96 222.69 231.68

Eclerx Ltd. 7917.17 5975.95 3518.03 3269.20 5864.02

Tech Mahindra 10646.66 9940.46 8777.41 9868.32 8409.52

Interpretation:
 Inventory turnover ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 0.00 0.00 0.00 0.00 0.00
TCS 78.38 83.07 224.92 254.00 129.71
Accenture 0 0 0 0 0
Eclerx Ltd. 0 0 0 0 0
Tech Mahindra 0.00 0.00 0.00 0.00 0.00

Interpretation: Here being in IT sector majority of firms have zero inventories except for
TCS; who have high inventories ratio could mean that it need to restock inventory
constantly, which could lead to stockouts.
 Debtor’s turnover ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 6.10 5.79 5.32 5.45 5.91

TCS 6.00 5.98 5.42 5.75 6.83

Accenture 0 0 0 0 0

Eclerx Ltd. 4.38 3.36 3.60 4.13 6.10

Tech Mahindra 4.26 4.69 5.22 4.80 9.13

Interpretation: Here, the Accenture Company have a zero ratio which would mean that it
has no debts owed by its debtors.
Infosys and TCS have higher ratio which means that there is efficiency in management of
debtors than compared to Eclerx and Tech Mahindra
 Creditor’s turnover ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 2.73 2.80 6.22 2.38 2.17

TCS 0.203 0.146 0.200 0.264 0.364

Accenture 0 0 0 0 0

Eclerx Ltd. 0 0 0 0 0

Tech Mahindra 4.74 4.94 4.48 4.29 7.10

Interpretation: Here Accenture and Eclerx have a zero ratio which would mean that it
has no debts owed by its suppliers. As compared Tech mahindra has highest ratio which
means company pays off its debts to suppliers rapidly than Infosys and TCS.
 Inventory holding period
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 0.00 0.00 0.00 0.00 0.00

TCS 4.66 4.39 1.62 1.44 2.81

Accenture 0 0 0 0 0

Eclerx Ltd. 0 0 0 0 0

Tech Mahindra 0.00 0.00 0.00 0.00 0.00

Interpretation: Compared to previous years, in 2022 and 2023 the ratio has increased but
still is lower which means less time is taken to convert inventories into sales
 Debtor’s collection period
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 2226.42 2114.64 1941.31 1989.48 2157.84
TCS 60.81 61.06 67.38 63.44 53.47
Accenture 0 0 0 0 0
Eclerx Ltd. 1597.17 1226.64 1315.23 1508.75 2225.59
Tech Mahindra 1,555.64 1,710.71 1,903.97 1,752.28 3,332.10

Interpretation:Here Infosys have highest collection period which indicates that the
company is collecting payments at a slower rate, than compared to other companies.
 Creditor’s payment period
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 994.93 1020.53 2271.77 867.72 793.40

TCS 1800.74 2495.84 1822.50 1382.59 1002.30

Accenture 0 0 0 0 0

Eclerx Ltd. 0 0 0 0 0

Tech Mahindra 1730.61 1804.34 1635.34 1565.21 2592.66

Interpretation: As Compared TCS and Tech Mahindra have highest payable period , it is
taking too long to pay its creditors which would also mean that the suppliers are not
charging interest.
 WC Days
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 1231.49 1094.11 -330.46 1121.76 1364.45
TCS -1735.3 -2430.390 -1753.505 -1317.713 -946.020
Accenture 0 0 0 0 0
Eclerx Ltd. 1597.17 1226.64 1315.23 1508.75 2225.59
Tech Mahindra -174.97 -93.62 268.63 187.07 739.44

Interpretation: Negative working capital can be advantageous for a company

that sells products or services for cash but pays its suppliers on credit .
Negative working capital is a sign of efficiency in businesses with low
inventory and accounts receivable.
 Gross profit margin
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 29.60 31.44 33.47 33.58 34.80

TCS 74.23 76.38 76.01 78.64 81.91

Accenture 31.99 32.38 31.53 30.81 30.48

Eclerx Ltd. 38.81 41.31 38.71 38.71 41.97

Tech Mahindra 60.06 60.09 61.81 60.28 62.32

Interpretation:
 Operating Profit Margin
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 21.06 23.03 24.51 21.34 22.84

TCS 24.06 25.27 25.88 24.58 25.57

Accenture 11.82 11.34 10.69 12.52 12.13

Eclerx Ltd. 31.47 36.21 20.57 18.90 38.95

Tech Mahindra 23.06 26.36 28.66 26.24 28.88

Interpretation:
 Net Profit Margin
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 16.43 18.21 19.33 18.33 18.64

TCS 18.76 20.05 19.83 20.67 21.55

Accenture 8.70 8.23 8.08 9.71 8.73

Eclerx Ltd. 14.31 32.78 19.79 4.35 20.37

Tech Mahindra 10.15 15.49 14.79 17.42 16.09

Interpretation:
 ROCE
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 51.62 48.90 42.50 40.74 41.84

TCS 827.94 703.58 604.89 588.41 2634.43

Accenture 192.62 100.01 83.47 182.28 185.85

Eclerx Ltd. 33.32 24.96 14.17 14.04 41.70

Tech Mahindra 0.39 0.34 0.33 0.34 0.38

Interpretation:
 ROE
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 31.82 29.04 27.24 25.43 23.72

TCS 5682.07 5564.25 5017.26 6031.04 7382.92

Accenture 887.18 780.31 781.22 2003.47 981.10

Eclerx Ltd. 15.15 22.59 13.63 3.23 21.80

Tech Mahindra 10.03 15.28 14.55 17.13 15.81

Interpretation:
 P/E ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 23.22 25.49 29.35 34.34 37.76

TCS 29.12 32.37 38.68 38.91 40.39

Accenture 28.22 29.56 34.56 40.13 43.02

Eclerx Ltd. 6.78 2.25 3.20 3.20 3.05

Tech Mahindra 29.03 22.33 25.78 24.03 25.47

Interpretation:
 Dividend Yield ratio (%)
Companies FY2023 FY2022 FY2021 FY2020 FY2019

Infosys 2.44 2.24 1.61 1.67 2.36

TCS 3.37 1.07 0.86 2.99 0.90

Accenture 1.05 1.21 1.09 0.99 0.91

Eclerx Ltd. 0.55 0.37 0.37 0.37 0.37

Tech Mahindra 4.47 4.02 4.02 1.34 1.25

Interpretation:
 Dividend Payout ratio
Companies FY2023 FY2022 FY2021 FY2020 FY2019
Infosys 56.57 57.22 47.12 57.33 88.98
TCS 101.94 287.81 298.90 85.94 275.51
Accenture 3.38 2.80 2.65 2.51 2.57
Eclerx Ltd. 0.04 0.01 0.01 0.01 0.01
Tech Mahindra 1.30 0.90 1.04 0.32 0.32

Interpretation: