HEADLINES:
September 15 2019
TCS shares jump on strong Q2, but brokerages cautious
22 October 2012

Tata Consultancy Services, India's biggest software services exporter, was the top gainer on the 50 share Nifty benchmark on Monday. Shares in the company traded with over 2 per cent gains in a weak market in early trade.

On Friday, TCS had reported strong earnings for the July-September quarter. Net profit jumped 7 per cent sequentially to Rs. 3,510 crore against Rs. 3,280 crore in the June quarter. TCS also managed to beat estimates on the volume and pricing front. Volume growth was flat at 5 per cent against 5.3 per cent in the June quarter.

The only disappointment was the slight dip in EBIT (earnings before interest and tax) margins, which rose at 26.8 per cent against 27.5 per cent in the June quarter.

Most brokerages held their rating on the stock post the earnings announcement.

CLSA maintained an "underperform" call on TCS, but raised the target price to Rs. 1,290 from Rs. 1,250. Goldman Sachs retained its "equal weight" rating on TCS, but raised the target price to Rs. 1,290 from Rs. 1,250.

Among top global brokerages, Credit Suisse had the most bullish call. Credit Suisse has an "outperform" call on the stock with a target price of Rs. 1,450.

Domestic brokerage major Kotak has a "reduce" call on the stock with a target of Rs. 1,225. Kotak cited rich high valuations for its cautious stance.

At 09.15 a.m., TCS shares traded 2.1 per cent higher at Rs. 1,316.80 on the NSE, outperforming the broader BSE IT index, which traded with 0.6 per cent gains.

 

 

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