Hot Stocks: Brokerages on TCS & Delhivery

Brokerage firms CLSA, Macquarie and Bernstein maintained outperform while Citi maintained sell rating on TCS. Morgan Stanley expects strong improvement in Delhivery.

We have collated a list of recommendations from top brokerage firms from ETNow and other sources:

CLSA on TCS: Outperform | Target Rs 3450
CLSA maintained outperform rating on TCS with a target price of Rs 3,450.


“TCS Q2FY23 results were in-line with our estimates and have increased confidence in margin management. We remain constructive on the stock,” the brokerage said.

Citi on TCS: Sell | Target Rs 2900
Citi maintained sell rating on TCS with a target price of Rs 2,900. The brokerage believes management commentary was mixed and not surprising given the backdrop.

“TCS delivered QoQ growth above expectations and UK accelerated & India delivered strong QoQ growth. Estimate/target price to go up slightly as we tweak INR assumptions and macro concerns remain," it said.

Macquarie on TCS: Outperform | Target Rs 4150
Macquarie maintained an outperform rating on TCS with a target price of Rs 4,150. The brokerage believes that management of TCS called out further headroom to improve utilization.

"Utilization helps deliver margin surprise. Net hiring in the company is low, but we see that related to attrition," it said.

Bernstein on TCS: Outperform| Target Rs 3850

Bernstein maintained an outperform rating on TCS with a target price of Rs 3,850.

TCS deal wins in Q2FY23 were a healthy $8.1 billion, it said, adding that EBIT margins were in line at 24 per cent up 90bps QoQ. It raised FY23/24 EPS estimates by 1.2/2.6 per cent.

Morgan Stanley on Delhivery
The brokerage expects strong improvement in gross margin to 21 vs 16.8 per cent in Q1 in the company. It believes prices will fall relative to the country index over 60 days.

The brokerage expects volume of 359k, which is 78.6 per cent of peak volumes in Q4 and express parcel volumes of 192mn in Q2.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)