Stock to buy before Q4 results 2024: TCS share price on cusp of breakout. Should you buy?

  • Stock to buy before Q4 results 2024: TCS share price is on the cusp of giving a fresh breakout at 4,030 apiece level, say experts

Asit Manohar
Updated8 Apr 2024, 02:03 PM IST
TCS results Q4FY24: The market is expecting mid-single digit growth for the company's revenue, EBITDA, and PAT in Q4 results 2024, say experts.
TCS results Q4FY24: The market is expecting mid-single digit growth for the company’s revenue, EBITDA, and PAT in Q4 results 2024, say experts.

Stock to buy before Q4 results 2024: Shares of Tata Consultancy Services (TCS) witnessed sharp selling after Tata Sons stake sale news hit the headlines in mid-March 2024. However, TCS share price witnessed strong buying at lower levels 3840 to 3850 per share. After ending at 3,840 apiece on NSE on 27th March 2024, TCS share price has been ascending after every small profit-booking. TCS share price today touched an intraday high of 4,025.95 per share on NSE, logging a nearly 5 percent upside from the lows made after Tata Sons induced selling last month.

According to stock market experts, TCS share price is on the cusp of giving a fresh breakout at 4,030 apiece level. On breaching this hurdle on a closing basis, TCS share price may go up to 4,300 per share level in the short term. They said that the market is expecting mid-single digit growth for the company's revenue, EBITDA, and PAT in Q4 results 2024. They said that TCS shares are best placed for a medium to long-term investor as the Indian IT company's deal win growth in the recently ended quarter has gone up.

TCS Q4 results 2024: What market estimates

On the kind of TCS Q4 results 2024 that the market is expecting, Dhruv Mudaraddi, Research Analyst at StoxBox said, "We expect TCS to report mid-single digit growth in revenues, EBIT and PAT for Q4FY24. The key focus in results would be management commentary on the outlook for FY25, visibility for megadeals, pricing environment, and outlook for key verticals such as banking, hi-tech, and retail. On the back of Accenture’s recent results, we think that the near-term outlook for the IT sector remains uncertain due to macro headwinds leading to cautious spending by clients and a slowdown in deal ramp-ups."

Also Read: TCS, Wipro to Infosys — Is it wise to accumulate IT stocks in FY25?

Advising investors to remain vigilant about the tepid growth outlook by global IT major Accenture, Amit Goel, Co-Founder & Chief Global Strategist at Pace 360 said, “Q4 expectations dictate a modest growth of 2 percent to 4 percent in net profit and around 3 percent to 4 percent in revenue growth. The IT major is facing macro challenges as Accenture has reduced its sales forecast, and softness in discretionary spending will add to those challenges. The IT sector is currently trading at 25 times, which is 10 percent higher than the 5-year average of 23 times.”

Expecting minimal impact of weak Accenture results on TCS, Saurabh Jain, Vice President — Research at SMC Global Securities said, "The Indian IT companies including TCS gain a good amount of outsourcing business from the US IT giants and Accenture is one of them. so, it will have some impact on the TCS business. However, the market has already discounted that factor. One must note that the rate of deal wins by the Indian IT companies including TCS has gone up in the January to March 2024 quarter. This is expected to reflect in TCS Q4 results 2024 and in the next few quarterly results provided the deal win rate continues."

The SMC Global Securities expert advised medium to long-term investors to add TCS shares to their stock portfolio or accumulate more on bid dips.

TCS share price target

Advising investors to look at TCS shares, Dhruv Mudaraddi of StoxBox expert said, "TCS share price is better placed in the large-cap IT pack on the back of better utilization across the employee pyramid, lower sub-contract costs and increasing contribution from large deals in the past. We advise investors to hold on to the blue-chip and add further on any declines from a medium to long-term perspective."

On how TCS share price is placed on the chart pattern, Sumeer Bagadia, Executive Director at Choice Broking said, "TCS share price is on the cusp of giving a fresh breakout at 4,030 apiece level. On breaching this hurdle on a closing basis, TCS share price may touch 4,200 and 4,300 per share level in the short term. Those who have TCS shares in their portfolio are advised to upgrade the trailing stop loss at 3,900 per share mark."

On the suggestion to the fresh investors, Sumeet Bagadia of Choice Broking said, "Fresh investors can buy TCS shares at the current level and keep accumulating on every big dip for the short-term target of 4,300 per share level. However, one must maintain stop-loss at 3,900 apiece level while taking any fresh position in the Indian IT major."

Disclaimer: The views and recommendations above are those of individual analysts, experts, and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.

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First Published:8 Apr 2024, 02:03 PM IST
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