Tata Consultancy Services: How it became the jewel in Tata group’s crown
Over the years, Tata Consultancy Services has become the biggest contributor to Tata group's market capitalisation and its profits.
The traditional business such as Tata steel and Tata Motors have played important role but the real kingpin for the Tata group has emerged to be Tata Consultancy Services (TCS).
The diversified conglomerate has foothold in many sectors such as IT, automobiles, steel, tea, chemicals, hotels, telecommunication, etc, with companies which are either listed or unlisted.
Over the years Tata Consultancy Services, India's largest software exporter, has become the biggest contributor to Tata group's market capitalisation and its profits, ET reported.
Six years ago, TCS accounted for just 33 per cent of Tata group's market cap. Now, having become the country's biggest beneficiary of global IT outsourcing, it contributes 66 per cent or Rs 4.34 lakh crore to the group's m-cap.
The software major has gained over 75 per cent in market cap in the past one year, while all other group companies, except Tata Motors and CMC, saw an erosion in m-cap, added the ET report.
Apart from TCS, the only other group company which gained a substantial market capitalisation is Tata Motors with an increase of Rs 12,717 crore.
"Tata group companies are spreading their wings to find a place in the global market. In the past few year the group has made few big ticket acquisition in the overseas market, such as acquisition of Corus by Tata Steel at an investment of $12 bn, Tata motors acquisition of Jaguar-Land Rover for $2.3 billion," said D K Aggarwal, CMD, SMC Investments and Advisors Ltd.
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"Besides other group companies like TCS, Indian Hotel, Tata Global Beverages and Tata Chemicals have expanded their reach in the global market through acquisition and association with global players," he added.
Brokerage raise target price for TCS post Q3 results:
After strong performance in the quarter ended December 31, global brokerage firm have maintained their rating but raised their respective target prices for Tata Consultancy Services (TCS) for 12-month period.
Out of 11 brokerage firm, five brokerage firms have a ‘BUY’ rating on the stock while three of them have kept outperform rating on India’s largest IT exporter.
While Citigroup and JPMorgan have their ‘Neutral’ rating on the stock and Barclays has an ‘Equal-Weight’ rating on the stock.
Here's how various brokerages view the stock:
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