Tata Consultancy Services Limited (TCS) AI Stock Analysis

• Market Cap: ₹10.72T
• Dividend Yield: 3.85%
• Average Volume (3M): 239.35K
• Price to Earnings (P/E): 21.7
• Beta (1Y): 0.96
• Revenue Growth: 3.62%
• EPS Growth: 4.43%
• Country: IN
• Employees: 607,979
• Sector: Technology
• Sector Strength: 88
• Industry: Information Technology Services
• EPS (TTM): 33.37
• Shares Outstanding: 3,618,087,400
• 10 Day Avg. Volume: 255,633
• 30 Day Avg. Volume: 239,351
• PEG Ratio: 4.01
• Price to Book (P/B): 14.20
• Price to Sales (P/S): 5.03
• P/FCF Ratio: 28.57
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹3,505.36
• Price Target Upside: 13.64% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 12

• Rating: 78 Outperform
• Price Target: ₹3,429.00 ▲(11.17% Upside)

TCS's strong financial performance is the most significant factor driving its overall score, supported by a solid balance sheet and efficient cash flow management. The valuation is reasonable, with a good dividend yield, although technical analysis shows mixed signals, indicating potential short-term volatility.

Tata Consultancy Services Limited Business Overview & Revenue Model

Company Description

Tata Consultancy Services Limited provides information technology (IT) and IT enabled services worldwide. The company operates through Banking, Financial Services and Insurance; Manufacturing; Retail and Consumer Business; Communication, Media and Technology; Life Sciences and Healthcare; and Others segments. It offers CHROMA, a cloud-based talent management solution; ignio, a cognitive automation software; TCS iON, an assessment platform; TAP, a procurement offering; TCS MasterCraft, a platform to automate and manage IT processes; Quartz, a blockchain solution; and TCS OmniStore, a commerce platform. The company also provides customer intelligence and insight solutions; Intelligent Urban Exchange, a smart city solution; OPTUMERA, a merchandise optimization platform; TwinX, an AI powered system of actionable intelligence for business leaders to simulate and optimize enterprise decisions; TCS BaNCS, a financial platform; and Jile, an agile DevOps platform. In addition, it offers drug development and connected intelligent platforms; ERP on cloud, an enterprise solution; and HOBS, a platform for subscription based digital business. Further, the company provides cognitive business, consulting, analytics and insights, automation and artificial intelligence, Internet of Things, cloud, blockchain, cyber security, interactive, digital and quality engineering, sustainability, and enterprise application services. It serves banking, financial, and public services; capital market; consumer goods and distribution; education; insurance; life sciences and healthcare; manufacturing, retail; hi-tech; travel, transportation, and hospitality industries; communications, media, and technology industries; and energy, resource, and utility industries. The company was founded in 1968 and is headquartered in Mumbai, India. Tata Consultancy Services Limited is a subsidiary of Tata Sons Private Limited.

How the Company Makes Money

TCS generates revenue primarily through its IT services and consulting offerings, which are billed on a time-and-materials basis or through fixed-price contracts. The company's key revenue streams include software development, system integration, application maintenance, and IT infrastructure services. Additionally, TCS provides business process outsourcing (BPO) services, which contribute significantly to its earnings. The company has established long-term partnerships with numerous Fortune 500 companies, which provide a steady flow of projects and contracts. TCS also invests in research and development to enhance its service offerings and maintain a competitive edge in the market, further driving its revenue growth.

Tata Consultancy Services Limited Financial Statement Overview

Summary

TCS exhibits exceptional financial health with strong revenue growth, profitability, and efficient cash flow management. The balance sheet is solid with low leverage, and the company is positioned well for future growth with minimal financial risk.

Income Statement

TCS demonstrates a strong income statement with consistent revenue growth and healthy profit margins. The TTM Gross Profit Margin is approximately 41.53%, and the Net Profit Margin is 19.43%. The revenue growth rate has been robust, with a 10.08% increase from the previous year. The EBIT and EBITDA margins stand at 24.94% and 28.54%, respectively, indicating efficient operations and strong earnings before and after depreciation and amortization.

Balance Sheet

The balance sheet of TCS reflects a solid financial position with a low Debt-to-Equity Ratio of 0.10, showcasing prudent financial management. The Return on Equity is approximately 48.60%, highlighting excellent profitability relative to shareholder equity. The Equity Ratio is 58.83%, indicating a strong capital foundation with more than half of the assets funded by equity.

Cash Flow

TCS maintains strong cash flow management with a Free Cash Flow growth rate of 9.60% in the latest TTM. The Operating Cash Flow to Net Income Ratio stands at 1.04, reflecting efficient cash conversion from net income. The Free Cash Flow to Net Income Ratio is 0.96, showing that a significant portion of net income is translated into free cash flow, supporting flexibility and strategic investments.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.56T	2.55T	2.41T	2.25T	1.92T	1.64T
Gross Profit	1.14T	1.10T	1.08T	1.06T	914.87B	773.02B
EBITDA	722.86B	713.69B	677.30B	626.62B	568.57B	483.66B
Net Income	492.73B	485.53B	459.08B	421.47B	383.27B	324.30B
Balance Sheet
Total Assets	1.66T	1.60T	1.44T	1.42T	1.31T	1.21T
Cash, Cash Equivalents and Short-Term Investments	420.44B	417.33B	439.04B	451.23B	483.01B	383.96B
Total Debt	96.10B	93.92B	80.21B	76.88B	77.95B	77.95B
Total Liabilities	675.29B	638.58B	551.30B	524.45B	516.68B	436.51B
Stockholders Equity	979.10B	947.56B	904.89B	904.24B	891.39B	864.33B
Cash Flow
Free Cash Flow	462.51B	449.71B	416.64B	388.65B	369.54B	356.26B
Operating Cash Flow	504.10B	489.08B	443.38B	419.65B	399.49B	388.02B
Investing Cash Flow	-39.69B	-23.18B	60.26B	390.00M	-8.97B	-81.29B
Financing Cash Flow	-481.59B	-474.38B	-485.36B	-478.78B	-335.81B	-326.34B

Tata Consultancy Services Limited Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 3084.55
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:TCS, the sentiment is Neutral. The current price of 3084.55 is above the 20-day moving average (MA) of 2978.09, above the 50-day MA of 3036.92, and below the 200-day MA of 3385.51, indicating a neutral trend. The MACD of 4.33 indicates Negative momentum. The RSI at 58.79 is Neutral, neither overbought nor oversold. The STOCH value of 84.34 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for IN:TCS.

Tata Consultancy Services Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TCS	―	₹10.72T	21.68	―	3.85%	3.62%	4.43%
HCLTECH	―	₹4.06T	23.73	―	3.13%	7.52%	0.87%
INFY	―	₹5.99T	21.23	―	2.95%	7.90%	4.28%
WIPRO	―	₹2.54T	18.83	―	4.51%	1.10%	14.83%
LTIM	―	₹1.66T	34.11	―	1.19%	8.72%	4.54%
Sector *	―	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
TECHM	―	₹1.42T	28.56	―	3.08%	3.30%	36.78%

Tata Consultancy Services Limited Corporate Events

TCS Clarifies Misleading Report on M&S Contract and Cyber Incident

Tata Consultancy Services Limited has addressed a misleading article published by The Telegraph, which inaccurately reported on TCS’s contract with Marks & Spencer (M&S) and a cyberattack incident. TCS clarified that the service desk contract with M&S was awarded through a competitive process unrelated to the cyber incident, and that the commercial aspect of the service desk is a minor part of their overall engagement with M&S. TCS also reiterated that it does not provide cybersecurity services to M&S, and the vulnerabilities did not originate from its systems.

TCS Hosts World’s Largest AI Hackathon to Drive Innovation

Tata Consultancy Services (TCS) has successfully concluded the world’s largest AI Hackathon, part of its strategy to foster an AI-first culture within the company. With participation from over 281,000 employees across 58 countries, the event showcased diversity and innovation, integrating AI solutions from top partners and TCS’s own platforms. The hackathon aims to enhance AI adoption among employees, providing them with tools and experiences to innovate and improve client solutions. The initiative has attracted interest from TCS customers, who are considering integrating hackathon-developed solutions into their products and services.

TCS Expands Partnership with Google Cloud to Integrate Gemini Enterprise AI Platform

Tata Consultancy Services has announced an expansion of its partnership with Google Cloud to integrate the Gemini Enterprise AI platform. This collaboration aims to enhance TCS’s capabilities in building AI solutions, empowering its workforce, and delivering innovative services to clients. The integration of Gemini Enterprise will allow TCS to develop custom AI agents and streamline operational workflows, reinforcing its position as a leader in AI transformation. The partnership is expected to accelerate innovation and provide significant value to TCS’s global customer base, as demonstrated by successful implementations with companies like FairPrice Group and CME Group.

TCS Publishes Q3 Financial Results in Major Newspapers

Tata Consultancy Services Limited has announced the publication of its audited consolidated and standalone financial results for the quarter ending September 30, 2025, in several major newspapers. This disclosure, in compliance with SEBI regulations, underscores TCS’s commitment to transparency and provides stakeholders with critical financial insights, potentially impacting investor confidence and market positioning.

TCS Releases Earnings Call Recording for Q2 FY26

Tata Consultancy Services Limited has released the audio recording of its earnings conference call for the quarter and six-month period ending September 30, 2025. The financial results, approved by the Board, provide insights into the company’s performance and strategic direction, potentially impacting stakeholders and market positioning.

TCS Issues Reminder on Unclaimed Dividends and Share Transfers

Tata Consultancy Services Limited has issued a reminder to shareholders regarding unclaimed dividends from the financial year 2018-19. The company has published notices in multiple newspapers to inform shareholders whose dividends have remained unclaimed for seven or more consecutive years, making their shares liable for transfer to the Investor Education and Protection Fund (IEPF) Authority. This move is in compliance with the Companies Act, 2013, and related rules, ensuring that shareholders are adequately informed and have the opportunity to claim their dividends before the shares are transferred.

TCS Extends Partnership with Weatherford for AI-Driven Transformation

Tata Consultancy Services has announced a five-year extension of its partnership with Weatherford International, a multinational oilfield service company. The renewed agreement will see TCS implement advanced AI-driven solutions to enhance operational efficiencies in finance, supply chains, and human resources, aiming to reduce costs and improve scalability. This collaboration builds on a seven-year relationship, during which TCS has significantly reduced Weatherford’s total cost of ownership. The partnership underscores the strategic importance of integrating AI-driven solutions in the energy sector to drive operational excellence and position Weatherford as a leader in adapting to the evolving industry landscape.