Hold TCS; target of Rs 2275: Axis Direct

Axis Direct recommended hold rating on TCS with a target price of Rs 2275 in its research report dated October 14, 2016.
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Oct 19, 2016, 05.11 PM | Source: Moneycontrol.com

Hold TCS; target of Rs 2275: Axis Direct

Axis Direct recommended hold rating on TCS with a target price of Rs 2275 in its research report dated October 14, 2016.

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Hold TCS; target of Rs 2275: Axis Direct

Axis Direct recommended hold rating on TCS with a target price of Rs 2275 in its research report dated October 14, 2016.

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, Axis Securities Limited |


Axis Direct's research report on TCS

TCS reported lower revenue in Q2FY17 largely due to BFSI softness, unexpected decline in Retail/ CPG and delay in India orders worth Rs 1.8 bn (60 bps impact to INR revenue). However, there has been no project cancellation. EBIT margin was better than expected due to operating efficiencies. Digital revenue (16.1%) continues to grow strongly (30% YoY). Q2FY17 was marked by continuation of strong deal wins (9 large deals) and maintained client mining momentum (USD 50 mn/ USD 20 mn+ revenue band increased by 1/6 QoQ).

Lower Q2FY17 revenue lead us to reduce our FY17/18E USD revenue growth by 1% each to 7/ 10% and our EPS to Rs 132/Rs 142. Given 2% downside from CMP of Rs 2,329, we maintain HOLD with TP of Rs 2,275 (16x FY18E EPS). The stock trades at 17.6x FY17E and 16.4x FY18E EPS.

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The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click here

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Hold TCS; target of Rs 2275: Axis Direct

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