Neutral TCS; target of Rs 2339: Arihant Capital

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Arihant Capital 's research report on TCS

TCS Q1FY21 earnings were below our estimates on all fronts as Covid-19 pandemic disrupted the business performance of the company. Consolidated revenue stood at Rs 3,83,220 mn, below our estimate of Rs 3,95,458 mn, registering +0.4% YoY/-4.1% QoQ. Consolidated EBIT stood at Rs 90,480 mn, down by -1.9% YoY/-9.7% QoQ. On the margins front, EBIT margin contracted by 54bps YoY to 23.6% due to higher employee costs and depreciation expenses. Consolidated PAT saw a decline of 13.8% YoY to Rs 70,090 mn, vs 81,270 mn in Q1FY20 due to lower other income. The board recommended an interim dividend of Rs 5 per equity share of Rs 1 each of the company.

Outlook

TCS also expects Q3FY21 INR revenue to be equal to Q3FY20. At CMP of Rs 2204, TCS currently trades at FY20 P/E of 25.5x Factoring in weak Q1FY21 results, we slightly lowered our FY21/FY22 estimates. We value TCS at PE of 25x to its FY22E EPS of Rs 94, which yields a target price of Rs 2339 per share. We upgrade our rating to Hold from Neutral earlier.

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.

Read More