The market capitalisation of Tata Consulting Services Ltd soared past ~11 trillion on Monday, making it the second Indian company to reach this landmark after Reliance Industries Ltd.
TCS stock soared almost 1.2 percent intraday to cross an all-time peak of ⁇ 2942 a piece for a market capitalization of ⁇ 11.03 trillion on the BSE. So far, this year, the script has expanded by 36%.
With an MCA of $12.75 trillion, Mukesh Ambani-led Reliance Industries Ltd remains India’s most valued firm.
According to Bloomberg, 26 of the 47 brokerages monitoring TCS suggested buying, 14 held selling, while 7 placed a hold rating on the market.
After Infosys and Wipro recently secured multi-million dollar deals with German companies, the latest spike in TCS stock was followed by a rally in IT firms.
The main strengths of TCS are pent-up demand from covid-19, return in the form of major IT outsourcing contracts, and underlying market transition, analysts said.
The company’s plan to buy back up to 53.33 million equity shares at ⁇ 3,000 a share for an aggregate sum not exceeding ⁇ 16,000 crore was accepted last month by TCS shareholders. The buyback began on December 18 and will close on January 1.
“Digitalization at scale and COVID-19’s acceleration of Work From Anywhere has boosted technology demand across industry verticals and geographies. Moreover, we note that IT outsourcing has seen strong pick-ups (lasting at least two years) after previous crises (such as Y2K and the GFC). These factors support our forecast of a third wave of IT outsourcing in FY21-23E,” said Goldman Sachs in a note
