ICICI Direct has given Buy recommendation for Tata Consultancy Services with a target price of Rs. 3800 in its research report issued on Apr 13, 2021

ICICI Direct’s research report on Tata Consultancy Services

Tata Consultancy Services’ (TCS) revenue growth was across geographies and verticals led by a ramp up of deal wins and transformational opportunities. US$ revenues grew 5.0% QoQ to $5,987.0 million vs. our estimate of 5.0% QoQ growth and $5,987.1 million estimate. EBIT margins expanded 20 bps QoQ to 26.8%. TCS has declared an interim dividend of Rs 15/share. One of the key highlights was that the company’s deal pipeline continues to be healthy at US$9.2 billion. The company aspires to register double digit revenue growth in FY22E.

Outlook

Hence, we maintain our BUY rating on the stock with a revised target price of Rs 3,800/share (PE of 30x on FY23E EPS) (earlier target price Rs 3,600).

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