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Consensus currently implies a potential upside of 12.3% from current levels for shares of TCS.
TCS reported December quarter results on Thursday, December 9, where its US Dollar revenue declined more than what a CNBC-TV18 poll anticipated, while its net profit and margins grew in-line with expectations.
The management of TCS expects the current calendar year to be better than 2024. The Tata Group giant announced a total dividend of ₹76 per share, which included a ₹10 interim dividend and a special dividend of ₹66 per share.
Brokerage firm Bernstein maintained its “outperform” rating on the stock with a price target of ₹4,700.
It said that signs of upcycle is when deal momentum accelerates, is broad-based and the management outlook starts to be upbeat. All of these factors were seen from TCS during the quarter, according to Bernstein.
CLSA has upgraded its rating on TCS to “outperform” and has also raised its price target on the stock to ₹4,546, citing multiple growth vectors ahead for the company.
The brokerage also said that valuations on a relative basis as well as when compared to its five-year average, look attractive.
Demand commentary is improving materially with a sharp pick-up in its order book and AI is another key positive for demand going ahead, according to CLSA.
Nomura though, remains “neutral” on TCS with a price target of ₹4,020. It said that growth visibility for financial year 2026 remains hazy for TCS, although it did mention that decision making is improving and signs of discretionary demand are also improving.
Nomura also expects TCS’ margins to improve further in financial year 2026.
HSBC too is “neutral” on TCS with a price target of ₹4,540. It did say that the performance for TCS may have bottomed out but it continues to see downside risks for consensus estimates for financial year 2026.
“TCS could relatively underperform other large peers on growth due to its higher exposure to Europe (where demand is weakening) & culmination of BSNL deal, which supported growth in financial year 2025,” HSBC wrote in its note.
Favourable forex and a strong recovery in discretionary demand are upside risks to estimates, HSBC said.
Out of the 49 analysts that have coverage on TCS, 31 of them have a “buy” rating on the stock, 13 say “hold”, while five of them have a “sell” rating on the stock.
Shares of TCS ended 1.6% lower on Thursday at ₹4,044. The stock has underperformed its peer Infosys over the last 12 months. In fact, it also trades at a discount to Infosys in valuation terms.
