Tata Consultancy Services Ltd. share price target

We recommend a BUY rating on the stock and assign a 28x P/E multiple to its FY23E earnings of Rs 128.2 per share to arrive at a TP of Rs 3,560 per share, implying an upside of 12% from CMP.

based demand environment characterized by (1) cost take-out and transformation led outsourcing or lift-shift-transform deals and (2) digital and cloud adoption led deals. Consecutive quarters of record hiring(freshers)...

Tata Consultancy Services, a division of Tata Sons Limited, is a global IT services organization that provides a comprehensive range of IT services to its clients in diverse industries. The Company, caters to finance and banking, insurance, telecommunication, transportation, retail, manufacturing,...

Tata Consultancy Services (TCS) reported revenue growth of 4.2% QoQ CC in 4QFY21 (v/s our estimate of 3.4%), delivering its third consecutive quarter of broad based (over 4% QoQ) growth. It marginally improved its EBIT margin to 26.8% (+20bp QoQ/+170bp YoY). The same was below our estimate (27.2%) on ramp up of large deals. Deal wins in 4QFY21 stood at USD9.2b, the highest in its history, with a book-to-bill ratio of 1.5x. A good 4Q helped it report sales (USD)/EBIT/PAT growth of 0.6%/10%/0.4% in FY21. Strong recovery from TCS, post the initial phases of the COVID-19 pandemic,...

We recommend BUY and assign 28x P/E multiple to its FY23E earnings of Rs. 127.4 per share which gives a TP of Rs. 3,560 per share, an upside of 10%.

expectations. Almost all sectors had strong sequential growth led by BFSI (+8.1 QoQ USD), Retail and CPG (+5% QoQ), Life Sciences and Healthcare (+4% QoQ) and Manufacturing (+5% QoQ). Both captive takeover deals won in Q3 in BFSI vertical (Postbank systems and Prudential Financial) are fully ramped up in Q4. FY21 revenue came at $22.17 Bn, +0.7% USD YoY. Deal TCV of $9.2 Bn was highest ever for a quarter, +3% YoY. FY21 order book size is robust at $31.6 Bn, +17.1% YoY. Management highlighted robust pipeline of smaller deals despite strong deal closure in Q4FY21. Smaller deals are also...

Tata Consultancy Services (TCS) for the quarter ended Mar 2021 reported a consolidated basis the revenue was up 4.2% QoQ and 5.9% YoY. Growth in CC revenue on sequential basis is largely due to growth in revenue of all business verticals of the company especially the BFSI. On YoY terms the CC revenue growth was led all verticals barring that of Retail & CPG and Communication & Media. The BFSI vertical which accounted for about 30% of the Q4FY21 revenue registered a growth of 7% QoQ and 13.3% YoY. Similarly the retail vertical that accounted for 15.5% of the revenue for the quarter was up by 4% QoQ but a fall of 0.9% YoY. The Life Sciences & Healthcare that...

TCS believes that tech refresh cycle driven by cloud migration and business transformation will play a critical role in driving multi-year technology growth. In addition, ancillary technologies developed around cloud will lead to new business models & differentiated customer experiences. The company's investment in upskilling of its employees, investment in research & development and industry-specific solution and contextual knowledge to drive business transformation will make TCS key beneficiary of this secular demand growth in coming years. This, coupled with increased outsourcing...

TCS reported a third consecutive quarter of all-round performance in Q4FY21. Revenue grew by 4.2% QoQ in CC (3rd consecutive quarter of 4%+ QoQ growth), higher than our forecast of +3%. However, EBIT margin improvement of ~20bps QoQ to 26.8% was slightly lower than our forecast of 27.3%. In Q4FY21, TCS has secured deals with an all-time high TCV of US$9.2 bn taking the FY21 TCV to US$31.6 bn, +17% YoY. TCS has maintained its positive outlook and is confident of achieving a double-digit YoY revenue growth in CC for FY22. We fine-tune our forecast of revenue/EPS CAGR of 11.8%/14.4% over FY21-23. We...

TCS's Q4FY21 revenue growth of 4.2% QoQ CC was broadly in line with our optimistic estimates in a seasonally weak quarter.