TCS shares were among the top NSE gainers on Friday, edging up after the Tata Group IT major announced a large strategic investment partnership with TPG Terabyte Bidco for its data centre arm, HyperVault.
The company said it has signed an agreement to invest up to ₹18,000 crore in HyperVault, a wholly owned subsidiary that will build AI-ready data centres with a capacity exceeding 1 gigawatt. As part of the structure, global alternative asset manager TPG will invest up to ₹8,820 crore, with TCS and TPG contributing capital in a 51:49 ratio.
Under the arrangement, TPG may hold between 27.5% and 49% in HyperVault, depending on the final tranches of Compulsorily Convertible Preference Shares (CCPS) issued over the next few years. Both sides will remain under a three-year lock-in period, and while TPG will be allowed up to two board seats, TCS will retain complete board control.
The development lifted sentiment around the stock, with market participants tracking the deal’s long-term potential in the fast-growing AI and data-infrastructure space.
Brokerage views
JPMorgan retained its ‘Overweight’ rating with a target price of ₹4,050, saying TPG’s investment of up to $1 billion reduces TCS’s equity burden. It added that while synergy benefits are possible through partnerships with global hyperscalers and AI firms, the investment may not materially alter shareholder returns in the next five to six years.
Morgan Stanley also reiterated its ‘Overweight’ call with a target price of ₹3,430, noting that private equity participation of this scale reinforces the long-term potential of the HyperVault platform.
Out of the 51 analysts tracking the stock, 36 recommend ‘Buy’, 10 suggest ‘Hold’, and five advise ‘Sell’.
