HSBC has maintained a Hold rating on Tata Consultancy Services (TCS) with a target price of ₹4,540, indicating a potential 12.27% upside from the current market price of ₹4,044.00.
Key Takeaways:
- Q3FY25 performance was described as unmemorable; however, TCS showed optimism for CY25 due to:
- Strong deal wins in Q3.
- Early signs of discretionary spend revival.
- Shortened deal cycles, indicating faster decision-making.
- Concerns ahead:
- Higher exposure to Europe, where demand is weakening.
- Impact of the culmination of the BSNL deal in FY26, which had supported FY25 growth.
- Possible downside risks to FY26 consensus estimates.
- Upside factors:
- Favorable forex movements.
- Strong recovery in discretionary spending, which could boost growth.
HSBC sees TCS’s performance bottoming out but notes its growth may underperform peers due to structural challenges in key markets.
Disclaimer: This article is for informational purposes only. Please consult a financial advisor before making investment decisions.
