Shares of Tata Consultancy Services (TCS) rose nearly 1% in early trade on Friday, tracking gains in the broader market, as investors reacted positively to its March quarter earnings. The January-March performance was largely in line with analysts’ estimates, supported by currency tailwinds that aided margins. However, a sector-wide re-rating appears unlikely in the near term amid persistent concerns over the impact of GenAI and ongoing geopolitical tensions in the Middle East.

Reacting to Q4 results, TCS shares gained as much as 0.92% to ₹1,088.20 on the BSE, while its market capitalisation climbed to ₹10.76 lakh crore. The country’s most valued IT stock opened a tad higher at ₹1,081.65 against the previous closing price of ₹1,078.20 apiece.

TCS shares touched a 52-week high of ₹3,630 on June 12, 2025, and a 52-week low of ₹2,346.35 on March 30, 2026. The Tata Group company has lost nearly 20% of its market capitalisation in calendar year 2026 amid a broad sell-off in technology stocks and rising concerns around artificial intelligence (AI)-led disruption.

Q4 profit jumps 12% YoY, revenue up 10%

For the Q4 FY26, IT services giant reported a 12% year-on-year (YoY) growth in its consolidated net profit at ₹13,718 crore, while revenue from operations rose 10% YoY to ₹70,698 crore. On the sequential basis, profit jumped 29%, while revenue was up 5.4% quarter-on-quarter.

TCS said the quarter marked its third consecutive period of sequential growth, supported by strong deal wins and execution. The company reported a total contract value (TCV) of $12 billion for the quarter, taking FY26 TCV to $40.7 billion, among the highest ever.

The board also recommended a final dividend of ₹31 per share, subject to shareholder approval. For FY26, total shareholder payout stood at ₹39,571 crore.

Domestic brokerages remain bullish post Q4

Domestic brokerages remained largely bullish on TCS post Q4 results, saying that performance was in line with their expectation.

Elara Capital maintained an ‘Accumulate’ rating with a revised target price of ₹2,780, noting that Q4FY26 revenue beat expectations, driven by international growth, even as FY26 revenues declined due to moderation in India business post the BSNL deal. It expects international momentum to sustain, supported by a robust $40 billion order book, while flagging a potential margin dip in FY27 due to limited currency tailwinds.

Emkay Global Financial Services retained an ‘ADD’ rating and raised its target to ₹2,950, citing steady sequential growth, strong deal wins of $12 billion, and improving traction across client segments. It also underscored TCS’ growing AI capabilities, with GenAI revenues at $575 million (7.5% of total), and expects a return to normal seasonality with stronger growth in H1FY27.

Similarly, Motilal Oswal Financial Services reiterated a BUY rating with a target price of ₹3,000, pointing to stable margins, strong cash flows, and a healthy order pipeline, with deal TCV at $40.7 billion for FY26. The brokerage expects a gradual recovery, with USD revenue and EPS CAGR of 3.8% and 7% over FY26–28, respectively, while margins are likely to remain broadly flat as gains are reinvested.

JM Financial also maintained an ADD rating with a revised target price of ₹2,730, noting in-line performance on both revenue and margins, alongside improving forward indicators such as order book growth and management’s positive outlook for FY27. It highlighted that geopolitical risks remain contained, with limited exposure to the Middle East and travel segment, while expecting better growth momentum in the first half of FY27.

Global brokerages maintain positive stance

Foreign brokerages maintained a broadly positive stance on TCS following its Q4 performance, with most highlighting steady execution, strong deal wins, and improving medium-term growth visibility.

CLSA retained an ‘Outperform’ rating with a target price of ₹2,985, noting revenue and EBIT margins were largely in line, while pointing to improving order bookings sequentially and GenAI as a key long-term growth driver, contributing 7.5% to revenue at an annualised $2.3 billion.

Goldman Sachs also maintained a Buy rating with a target price of ₹2,985, citing broad-based sequential growth and strong deal wins, including three mega deals, though it flagged modest growth momentum and limited margin expansion due to AI-led reinvestment.

JPMorgan remained among the most bullish with an Overweight rating and price target of ₹3,150, highlighting a revenue beat, stable margins, and robust deal wins worth $12 billion, alongside improving international demand and a strong capital return profile.

Similarly, Nomura reiterated its Buy rating with a target price of ₹2,930, expecting FY27 to outperform FY26 on the back of stronger international growth and margin stability despite continued reinvestments, while raising its medium-term earnings estimates.

However, a few brokerages remained cautious. HSBC maintained a Hold rating with a price target of ₹2,755, acknowledging a gradual demand recovery but expecting only mid- to low-single-digit growth over the longer term.

Jefferies was the most conservative, retaining an Underperform rating with a target price of ₹2,275, citing a margin miss, weak BFSI growth, and concerns around AI-led revenue deflation, which could keep margins rangebound and limit earnings growth over FY26-29.

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