TCS Gains 2% to 10-Week High; the stock is approaching its all-time high
Shares of Tata Consultancy Services (TCS) hit a more than 10-week high at 3,835.50 rupees, up 2% from BSE in Tuesday’s intraday trading. The stock traded higher for the third day in a row, gaining 4% during the period. It was trading at its highest level since January 24, 2022 and is only 5% away from the all-time high of Rs 4,045.50 reached on January 18, 2022.
On March 31, 2022, the information technology (IT) leader announced that the company’s board of directors would meet on Monday, April 11, 2022 to review financial results for the quarter and full year ending March 31, 2022.
The company announced Monday (April 4) that it has signed a major multi-year contract with a major US enterprise expanding its long-standing partnership to accelerate their cloud transformation journey and transform their technology landscape into a modern hybrid cloud stack for greater great agility. , flexibility and improved operational resilience.
Meanwhile, last month, TCS had completed its Rs 18,000 crore share buyback program, its fourth since 2017. The company had repurchased 40 million shares through the buyback offer. After the takeover, the ownership of the promoters and the promoter group company in TCS decreased from 72.19% to 72.30%.
TCS is a leading IT service provider with a presence in BFSI, communication, manufacturing, retail and high technology. and consistent organic revenue growth and industry-leading margins (>25%).
TCS is a key beneficiary of multi-year (15-20%) growth in digital technologies. “There would be pressure on margins in the short term, but we believe that as customers now recognize cost pressure and are receptive to price increases in transactions, this would mitigate any short term impact on margins.” , said ICICI Securities.
The company believes that it is investing in the areas of future technologies, i.e. contactless payments, battery management software for electric vehicles, etc., which will help it to participate in larger transactions at the future, the brokerage said. He expects the stock to eventually challenge its lifetime highs in the coming months with a target of Rs 4,070.
TCS remains best positioned to benefit from long-term structural tailwinds in technology services and should see a relative pick-up in growth as the base effect and increased aggressiveness help it.