Buy Tata Consultancy Services; target of Rs 5230: Sharekhan

Buy

Sharekhan's research report on Tata Consultancy Services

Reported revenues stood at $7,539 million, down 1.7% q-o-q/ up 3.5% y-o-y, missing our estimate of $7591 million. EBIT margin rose by ~40 bps q-o-q to 24.5%, in-line with estimates. Order book TCV stood at $10.2 billion, up 19% q-o-q/25% y-o-y. Book-to-Bill ratio stood at 1.3x. Early signs of a revival in discretionary spend in some verticals along with BFSI and Consumer Business provides a strong growth recovery narrative for CY25 and FY26.

Outlook

We maintain a Buy rating with an unchanged PT of Rs. 5,230. At CMP, the stock trades at 29.5/26.5/23.8x FY25/26/27E EPS.

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Tata Consultancy Services - 10012025 - khan