Analysts revise target price of TCS share upwards to ₹3,6001 min read . Updated: 13 Jan 2021, 07:07 AM IST
- ICICI Securities recommends buy rating for TCS share
- It has revised the target price of the stock upwards to ₹3,600 from an earlier target price of ₹3,410.
IT major Tata Consultancy Services (TCS) reported a healthy set of Q3FY21 results. Analysts believe the results of the IT major were above their estimates on all fronts. Growth happened across geographies and verticals. "The QoQ growth in revenues was led by healthy demand in core transformation services and conversion from earlier deals. US$ revenues grew 5.1% QoQ to $5,702 million, above our estimate of 3.6% QoQ growth and $5,619 million estimate. EBIT margins expanded 42 bps QoQ to 26.6%, above our estimates of 25.1%," says ICICI Securities.
The brokerage recommends buy rating for TCS share. It has revised the target price of the stock upwards to ₹3,600 from an earlier target price of ₹3,410.
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Current market price of TCS on NSE is ₹3,172 per share.
TCS has declared an interim dividend of ₹6 per share. The company aspires to register double digit revenue growth in FY22E.
Going forward, global digital technologies are expected to witness robust growth (~15-20% CAGR in the next five years) led by robust growth in cloud, customer experience and robust growth in cloud native technologies, believes the brokerage. Considering TCS’s digital prowess coupled with market share gains via vendor consolidation, captive carve outs and increase in outsourcing ICICI Securities expects TCS to register robust growth in revenues in coming years. This, coupled with healthy margins and better capital allocation prompt us to be positive on the stock from long term perspective.
TCS on Tuesday said it will acquire GE's stake in Tata Consultancy Services Saudi Arabia for $12,471 (about ₹9.13 lakh).
In September 2013, TCS announced the creation of an all-women business process services centre in Riyadh (Saudi Arabia) in partnership with GE.