TCS Shares May Rally 36% Says Motilal Oswal After Q3 Results

Motilal Oswal has maintained its Buy rating on Tata Consultancy Services with a target price of Rs 4,400, implying an upside of ~36% from current levels.

The brokerage expects USD revenue and EPS to compound at ~3.6% and ~7.6% respectively over FY25–28, supported by steady growth in select demand pockets and reasonable deal visibility, despite continued volatility in deal closures.

Key Takeaways from Q3 Results

The Q3 results of TCS shares have been a mixed bag, with some positives and negatives. The company’s revenue growth has been steady, but the profit margins have been under pressure due to various factors.

However, the management of Tata Consultancy Services has expressed confidence in the company’s ability to navigate the challenges and deliver strong growth in the coming quarters.

Outlook for Indian IT Sector

The Indian IT sector has been facing several challenges in recent times, including the slowdown in global economic growth, trade tensions, and the impact of the COVID-19 pandemic.

However, the sector is expected to recover in the coming quarters, driven by the growth in digital transformation, cloud computing, and artificial intelligence. Indian IT companies are well-positioned to benefit from these trends, given their strong capabilities in these areas.

Investment Strategy

Investors looking to invest in TCS shares should consider the company’s strong fundamentals, including its robust revenue growth, healthy profit margins, and strong balance sheet.

However, they should also be aware of the risks and challenges facing the company, including the uncertainty in global economic growth, trade tensions, and the impact of the COVID-19 pandemic.

Target Price and Valuations

Motilal Oswal has maintained its Buy rating on Tata Consultancy Services with a target price of Rs 4,400, implying an upside of ~36% from current levels.

The brokerage expects the company’s USD revenue and EPS to compound at ~3.6% and ~7.6% respectively over FY25–28, supported by steady growth in select demand pockets and reasonable deal visibility.

Conclusion

In conclusion, TCS shares are a good investment opportunity for investors looking to invest in the Indian IT sector. The company’s strong fundamentals, including its robust revenue growth, healthy profit margins, and strong balance sheet, make it a attractive investment option.

However, investors should be aware of the risks and challenges facing the company, including the uncertainty in global economic growth, trade tensions, and the impact of the COVID-19 pandemic. They should also consider the target price and valuations of the company before making an investment decision.

TCS Shares May Rally 36% Says Motilal Oswal After Q3 Results — Check Target Price