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Why it's recommended: TCS reported a 6% YoY growth in revenue from operations from ₹2,40,893 crore in FY24 to ₹2,55,324 crore in FY25 and 3.8% growth in dollar terms, with a slight decline in operating margin of 24.3% from 24.6% YoY. The net margin is also slightly flat at 19.0% YoY, and EPS growth of 5.05% YoY indicates consistent profitability.

Additionally, free cash flow of $1.48 billion and invested funds of $5.53 billion highlight TCS’s strong liquidity position, enabling sustained shareholder returns. Furthermore, the order book TCV (total contract value) stood at $12.2 billion, with North America TCV reaching an all-time high of $6.8 billion, BFSI TCV at $4.0 billion, and Consumer Business TCV at $1.7 billion, which reflects TCS’s ability to gain market share.

TCS has a strong workforce of 6.07+ lakh employees. The company has 13.3% IT services attrition and 35.2 % women employees, highlighting its focus on talent retention, diversity, and development. A structured hiring strategy and diverse global presence (152 nationalities) ensure scalability and operational efficiency, strengthening its long-term growth prospects. The management also noted that TCS is gearing up to onboard an increased number of campus hires in FY 26.

The management is confident that FY26 will be better than FY25 for its international business and also the domestic business, once the macroeconomic uncertainty softens. While TCS has completed a significant portion of the BSNL deal, which could dampen its revenue, the company is looking out for various opportunities to replace this revenue domestically and internationally and enhance margins, with a target of achieving 26% operating margins.

Additionally, robust TCVs in Q3 and Q4 further boost confidence in the company’s growth prospects for FY26.

Risk Factor: If the current macroeconomic uncertainty pertaining to US tariffs prevails or worsens, it can lead to lower operating leverage for the company as utilization will be impacted, and sudden contraction in demand delays or deferrals, which could affect the margins.

Also Read: TCS commentary offers some optimism, but the Street isn’t buying it

Why it's recommended: Dmart’s consolidated revenue from operations saw a growth of 16.87% YoY from ₹50,789 crore in FY24 to ₹59,358 crore in FY25, and their profit for the period stood at ₹2,707.45 crore, with a growth of 6.8% YoY and a PAT margin of 4.6%.

Additionally, EPS growth of 6.7% YoY indicates consistent profitability. Earnings before interest, tax, depreciation, and amortization (Ebitda) in FY25 stood at ₹4,487 crore, as compared to ₹4,104 crore during FY24, and the Ebitda margin stood at 7.6%.

Their days inventory and days payables were stable at 31.4 and 7.2, respectively, with a lower debt-to-equity ratio at 0.03 for FY25. Dmart’s store count expanded by adding 50 stores this year to reach 415 stores in FY25, from 365 stores in FY24. Its e-commerce venture, Dmart Ready, is currently servicing 25 cities and is growing extremely well in key metro towns, as per the management. DMart’s retail business area of 17.2 million sq. ft. spans across Maharashtra, Gujarat, Telangana, Andhra Pradesh, Karnataka, Tamil Nadu, Madhya Pradesh, Rajasthan, Punjab, NCR, Chhattisgarh, and Daman.

Business remains resilient in metro towns, but non-metro areas are seeing significantly stronger growth. Like-for-like growth is relatively better in metro areas with lower DMart store density. While gross margins in mature metro markets may stay soft for some time, the management remains confident that DMart’s value proposition is well-established in the minds of consumers.

D-Mart follows the Everyday Low Cost–Everyday Low Price strategy, which aims at procuring goods at competitive prices using operational and distribution efficiency. This strategy delivers value for moneyto customers by selling at competitive prices and will help in increasing store footfall, along with strengthening customer loyalty.

Risk Factor: If the competitive intensity in the FMCG space continues to increase, it might further impact the company’s gross margins. The management also flagged a concern regarding a surge in wages of entry-level positions due to a demand/supply mismatch of skilled workforce that could lead to increased staffing costs if not dealt with properly.

Also Read | Shareholdings moves in Q4: Indian Inc’s founders hike stakes in select small-cap firms

● Why it’s recommended: Strong financial performance, attractive shareholder returns

● Key metrics: P/E: 23.46, 52-week high: ₹ 563.45, volume: ₹ 32.54 crore

● Technical analysis: Holding its 200-DMA for the past three days

● Risk factors: Exposure to raw material price volatility, regulatory and environmental compliance:

● Buy at: ₹ 451.95

● Target price: ₹ 525 in three months

● Stop loss: ₹ 421

Read this | Tata Motors’ windscreen is hazy amid the fog of tariffs

● Why it’s recommended: Strategic capacity expansion and robust financial performance

● Key metrics: P/E: 59.97, 52-week high: ₹ 743, volume: ₹ 104.81 crore

● Technical analysis: Horizontal trendline breakout

● Risk factors: Dependence on key geographies

● Buy at: ₹692

● Target price: ₹845 in three months

● Stop loss: ₹625

MarketSmith India: Trade name: William O'Neil India Pvt. Ltd; Sebi-registered research analyst registration number: INH000015543

Trade Brains Portal is a stock analysis platform. Trade name: Dailyraven Technologies Private Limited. Its Sebi registered research analyst registration number is INH000015729.

Ankush Bajaj is a Sebi-registeushred research analyst. His registration number is INH000010441.

Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by Sebi and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.

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