Overview
- TCS booked Rs 2,128 crore, Infosys Rs 1,289 crore and HCLTech Rs 956 crore in Q3 FY26 as past-service costs tied to gratuity and leave remeasurement.
- Reported operating margins were 25.2% for TCS, 18.6% for HCLTech and 18.4% for Infosys, with Infosys indicating ~21.2% excluding labour‑code expenses.
- Company leaders guided to a limited recurring impact of roughly 10–20 basis points on margins, describing the Q3 charges as largely historical.
- Jefferies estimates the accounting reset could cut sector quarterly profits by 10–20% and that higher structural employee costs may reduce FY27 earnings by 2–4%.
- The codes set wages at a minimum 50% of CTC for benefit calculations, expand leave encashment and extend gratuity and social security to fixed‑term staff, with analysts expecting slower senior‑level pay hikes as a potential offset.