JM Financial recommended hold rating on TCS with a target price of Rs 1720 in its research report dated July 10, 2018.
JM Financial's research report on TCS
TCS’ 1QFY19 result was marked by a strong margin management; reported USD revenue growth was broadly in-line. Management exuded confidence on recovery in the troubled US BFS vertical and indicated improved visibility on the medium-term outlook with a USD 4.9bn of pending order book in 1QFY19. This sets TCS well for a double-digit growth in FY19 though the high share of mega deals limits extrapolation over the longer term. We raise our FY19/FY20 EPS forecasts by 4% each on 1QFY19 margin beat + currency reset. The stock trades at 21X FY20F EPS, at 33% premium to INFO and 19% premium to its own 5-year median. Thus, while we recognize the recovery in growth trajectory and TCS’ aptitude in sole-sourcing large deals, the stock’s rich valuations restricts us from turning constructive.
Maintain HOLD. Our price target moves to INR 1,720 (INR 1,640 earlier), also on roll-forward.
For all recommendations report, click here
Disclaimer: 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.Are you happy with your current monthly income? Do you know you can double it without working extra hours or asking for a raise? Rahul Shah, one of the India's leading expert on wealth building, has created a strategy which makes it possible... in just a short few years. You can know his secrets in his FREE video series airing between 12th to 17th December. You can reserve your free seat here.