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Tata Consultancy Services (TCS) shares surged on Friday, July 10, following the release of the company’s Q1FY27 earnings. The share price rose more than 4% to Rs. 2,132 on the BSE, while it opened higher at Rs. 2,105.20 on the NSE and later hit Rs. 2,133.30.
The rally is no doubt welcome news for investors despite the stock's recent weak performance. TCS shares have fallen 2% over the past month, 16% over the past three months, 33% over the past six months and 38% over the past year.
TCS reported a consolidated net profit of Rs. 13,349 crore for the quarter ended in June, nearly a 5% rise year-on-year from Rs. 12,760 crore. However, the profit fell 3% sequentially from Rs. 13,718 crore in the March quarter.
Revenue from operations increased 14% YoY from Rs. 63,437 crore to Rs. 72,275 crore. Sequentially, revenue grew by 2% from Rs. 70,698 crore. The company's operating margin stood at 24% and its net margin was at 19.2%.
TCS also recorded a strong total contract value of $9.5 billion in the quarter. The company's AI revenue run rate hit an annualised $2.6 billion, a 13.6% quarter-on-quarter growth.
The Board announced an interim dividend of Rs. 12 per share. The record date is July 15, 2026 and the dividend will be paid on July 31.
Also Read: TCS AI Shift: Artificial Intelligence Now Allocates 50% of Internal Roles
TCS Chief Executive Officer and Managing Director, K Krithivasan, shared his views and said the company continues to show resilient growth despite geopolitical and macroeconomic uncertainties.
"Q1 FY27 reflects continued growth momentum and the strength of our strategic positioning, despite geopolitical and macroeconomic headwinds. We delivered a strong order book of $9.5 billion, including a marquee AI-led transformation deal with SKF, while continuing to add clients across key revenue bands and scaling our AI business to a $2.6 billion annualized revenue run rate. “Krithivasan said.
He added, “As customers accelerate investments in AI, modernization, cybersecurity, sovereign cloud and platform simplification, our strong deal conversion, improving client mining and expanding ecosystem partnerships position TCS well to translate opportunity into sustained growth."
Nomura believes that “deal bookings” at TCS offer ‘reasonable growth visibility '. The brokerage had maintained a ‘Buy' rating and had increased its target price for the stock to Rs. 2,590.
Centrum Broking had maintained its ‘Buy’ rating with a target price of Rs. 3,480. Record deal wins and enterprise adoption of AI-driven transformation are helping to bring about medium-term revenue visibility, it said.
Anand Rathi has kept a ‘Buy’ rating with a target price of Rs. 2,408 for the stock, on the back of ‘resilient deal bookings and improving revenue conversion’.
360 ONE Capital kept a ‘Hold’ rating on the stock with a price target of Rs. 2,290, citing that the re-rating of the stock may be restricted over the near term owing to disruption from AI, pricing pressure and weak macro conditions.
