Tata Consultancy ServicesGains 23% in One Month

TCS Tata Consultancy Services (TCS) has witnessed a strong recovery in its share price, gaining approximately 23.16% over the past month amid improving sentiment towards Indian IT stocks. The recent rally follows concerns over artificial intelligence-led disruption and pressure on traditional IT services business models. The company's Q2 FY27 performance also remained healthy, with consolidated revenue increasing 11.2% year-on-year to ₹73,188 crore and net profit rising 7.6% to ₹13,884 crore. In a recent development, global brokerage Citi raised its target price on TCS to ₹2,000 from ₹1,840, while retaining its Sell rating on the stock. The brokerage increased its target price-to-earnings multiple from 12 times to 13 times, primarily reflecting a broader valuation rerating of the IT sector. However, Citi expects TCS's earnings per share growth to remain moderate at around 2–3% annually during FY28–FY29, indicating that higher valuations are not yet supported by a significant improvement in earnings estimates. Meanwhile, TCS continues to strengthen its artificial intelligence business, with annualised AI revenue crossing $3.1 billion in Q2 FY27 and total contract value of new deals reaching $9.6 billion. Strategic partnerships with Porsche AG and Best Buy are expected to support its AI-led transformation and enterprise technology business. Going forward, investors will closely monitor deal conversions, global IT spending, AI-related revenue growth and operating margins to assess the sustainability of the recent stock price recovery.