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Motilal Oswal Report
Tata Consultancy Services Ltd. remained in focus after Motilal Oswal reiterated its 'Buy' rating on the stock with a target price of Rs 2,350, implying a potential upside of around 15% from current levels.
The brokerage maintained its positive stance after the IT services giant reported a better-than-expected performance for the June quarter.
TCS Q1 FY27 Results
TCS reported Q1 FY27 USD revenue of $7.6 billion, up 0.4% QoQ in CC and above our estimate of flat QoQ CC growth. Q1 growth was led by hi-tech/ BFSI/regional markets, up 1.7%/1.6%/4.0% QoQ cc, while consumer/ healthcare fell 4.0%/1.0% QoQ cc.
Ebit margin was 24% (down 130 basis points QoQ), in line with our estimate of 23.9%. Adj PAT was up 1% QoQ/8.6% YoY at Rs 13,900 crore, above brokerage's estimate of Rs 13,6000 crore.
In INR terms, Q1 FY27 revenue/Ebite/adjusted net profit grew 13.9%/11.6%/8.5% YoY. Cash flow from operations stood at 93% of net profit for Q1 FY27.
In Q2 FY27, Motilal Oswal expect revenue/Ebit/adj. PAT to grow 10%/8.4%/9.3% YoY.
TCS reported a deal total contract value of $9.5 billion, down 20.8% QoQ and up 1.1% YoY. The book-to-bill ratio stood to 1.2 times.
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