TCS market cap crosses Rs 13.5 trillion; stock up 15% in a month

In the past month, TCS has outperformed the market by surging 15 per cent, as compared to a 6 per cent rise in the S&P BSE Sensex

Shares of Tata Consultancy Services (TCS) hit a new high of Rs 3,694.25, up 2.3 per cent on the BSE in intra-day trade on Wednesday and became the second listed company to cross the Rs 13.5 trillion market capitalisation (market cap). The stock of the information technology (IT) giant surpassed its previous high of Rs 3,672.50 touched on Monday, August 23, 2021.

In the past one month, TCS has outperformed the market by surging 15 per cent, as compared to a 6 per cent rise in the S&P BSE Sensex. The sharp rally in the stock price helped TCS' market cap rise to Rs 13.65 trillion. TCS is less than 3 per cent away to hit the Rs 14 trillion market cap mark. It currently stands at second position in the overall market cap ranking, behind Reliance Industries which has a market cap of Rs 14.51 trillion, including partly paid shares market cap, according to the BSE data.

TCS is one of the leading IT service providers with a presence in the BFSI, communication, manufacturing, retail & hi-tech verticals. The company generated consolidated revenues of US $22.2 billion in the fiscal year ended March 31, 2021.

Analysts say the company is well-positioned to benefit from the strong demand environment, acceleration in cloud adoption and digital transformation opportunities going ahead. “The company’s management also remains confident about the revenue growth trajectory in FY22 on broad-based demand, strong deal intake ($8.1 billion in Q1; 17 per cent YoY), healthy deal pipeline, and traction in the cloud, cyber security, analytics and enterprise application services,” analyst at Emkay Global Financial Services said in the Q1FY22 result update.

Growth drivers for TCS include a calibrated focus on upstream/consulting business (larger share of growth and transformation) increasing the addressable market/pipeline, increased outsourcing (Europe), core transformation deals, and strong growth in public hyper scale services, strong deal wins in retail & consumer packaged goods (CPG) vertical and increased deal volumes (not TCV) in BFSI, and near-term lift-off with recovery in the regional market segment (India revenue), analysts at HDFC Securities said.