TCS Q2 Results Review — Deal Wins Drive Growth, Margins Stable, Says Systematix Maintaining 'Buy'

TCS continues to gain market share across tech shifts, supported by broad-based revenue growth, strong deal ramp-ups, and diversified service offerings. Deep client trust and domain expertise position TCS as a key partner in digital transformation and cost optimization initiatives.NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Systematix Report.Tata Consultancy Services Ltd. reported steady revenue growth in Q2 FY26, supported by broad-based improvement across most verticals and geographies. Barring India, the company posted a 0.6% QoQ revenue growth. The quarter’s performance was aided by deal ramp-ups, operational discipline, and currency tailwinds, partly offset by residual macro caution impacting discretionary budgets in developed markets. The company reported a TCV of $10 billion, which included a large mega deal win during the quarter, providing enhanced revenue visibility for the coming periods. Management reiterated confidence in a stronger FY26/27 growth trajectory versus FY25, underpinned by-healthy deal conversions and pipeline visibility, early signs of stabilization in Retail and sustained improvement in BFSI and Europe, expanding AI adoption across client engagements driving incremental demand, and steady IT services spending despite near-term macro uncertainties. .We have revised our USD revenue CAGR estimate for FY25–27E downward from 4.6% to 2.7%, factoring in near-term softness and a cautious demand outlook. EPS and Ebit margin estimates for FY26E/FY27E assumptions remain largely unchanged. Accordingly, we lower our target price to Rs 3,733 (Rs 3,864 earlier), based on a lower multiple of 24x FY27E EPS (25x earlier). At 22x 1-year forward earnings, TCS trades at a 10% discount to its 10-year average—offering a favorable entry point. .Key risks:Abrupt exit/s from the leadership team,pressure on client discretionary spend sustaining in FY26/FY27, non-encouraging outcomes of costsaving programs..Click on the attachment to read the full report:.TCS Q2 Results Review — 'Buy' TCS Shares Maintains Motilal Oswal On Undemanding Valuations.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

TCS Q2 Results Review — Deal Wins Drive Growth, Margins Stable, Says Systematix Maintaining 'Buy'

At 22x 1-year forward earnings, TCS trades at a 10% discount to its 10-year average—offering a favorable entry point, adds the brokerage.

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