TCS Management is fully confident that the company’s revenue growth will be sustainable during the coming quarters.
TCS Stock Outlook: The stock of IT giant TCS has been under pressure this year. So far this year, the stock has come at a discount of 17 to 18 percent. At the same time, the stock has lost about 22 percent from its 52-week high. After the current fall, brokerage house Emkay Global is seeing a better valuation of the stock once again. There is no problem with the fundamentals of the company. The company’s quarterly results have also been better. The brokerage house says that TCS’s deal pipeline is strong, demand is better. There is some pressure on margins, but it is expected to improve from the second half of the financial year. The brokerage house has given a target of Rs 4000 for the stock with an estimate of 25 percent upside.
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Revenue growth confident of being sustainable
Brokerage house Emkay Global says that TCS Management says that there is no weakness in demand. On the other hand, even though there is uncertainty in Maco conditions, there is no delay in decision making from the client side. Management is fully confident that the company’s revenue growth will be sustainable during the coming quarters.
Deal pipeline strong, margins will be better
TCS’s deal pipeline remains strong. A good mix of large, medium and small deals. In FY22, the company had signed a deal worth $ 34,600 million, which is a 10 percent increase in yearly terms. The brokerage says that the margins of the company are expected to remain under pressure during H1FY23. This will also be affected due to Wazehike. However, margins are expected to improve in the second half due to reasons like better pricing, salary normalization.
some risk factors
The brokerage says that TCS is in a good position to take advantage of strong demand and opportunities for digital transformation. However, due to wage inflation, weakness in the rupee and the possibility of slowdown in the US and Europe, there are also some risk factors together. The brokerage house has advised investment in the stock and the target has been kept at Rs 4000.
(Disclaimer: Stock investment advice is given by the brokerage house. These are not the personal views of The Financial Express. Markets are risky, so take expert opinion before investing.)
