TCS, Infosys shares gain over 3% after brokerages' bullish nudge. What's driving the upgrades?

Shares of leading IT companies, Tata Consultancy Services (TCS) and Infosys, surged over 3% each on Monday after brokerages turned bullish. Investec upgraded Infosys to ‘Buy’ with a target of Rs 1,655, while JP Morgan raised TCS to ‘Overweight’ and hiked its target price to Rs 3,800 from Rs 3,650, according to a CNBC-TV18 report.

TCS has lagged broader markets in recent years, with its trailing price-to-earnings multiple halving from 41x to 20x. Over the past five years, the company has posted a profit CAGR of 8.5% but its stock CAGR was only 6%.

TCS fell by over 20% this year, but JPMorgan expects a recovery in the business from the second half of the financial year 2026.


The long-term story of the IT sector remains intact. Indian IT has compounded at 12.5% annually over the past two decades, though it underperformed the Nifty in the last three to five years.

Q1 Earnings Snapshot

TCS reported a 6% rise in Q1FY26 consolidated net profit at Rs 12,760 crore versus Rs 12,040 crore last year. Revenue from operations grew 1.3% year-on-year to Rs 63,437 crore.

The quarter was also marked by a robust Order Book and operational resilience. The Q1 Total Contract Value (TCV) stood at $9.4 billion.

TCS, meanwhile, is confident of navigating the challenges impacting its business through cost optimisation, vendor consolidation and AI-led business transformation.

Infosys, meanwhile, raised the lower end of its FY26 revenue guidance from 0–3% to 1–3%.

Choice Equities noted that while demand remains subdued due to tariffs and geopolitical headwinds, interest in AI-led transformation and cost-efficiency initiatives could fuel stronger growth in the second half of FY26.

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Choice has also upgraded Infosys to Buy with a target price of Rs 1,810, projecting revenue, EBIT and PAT CAGRs of 7.4%, 11.0% and 10.7% respectively over FY25–28.