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TCS Share Price: Shares of Tata Consultancy Services (TCS) traded higher on Thursday, December 18, a day after the company’s annual investor day, where India’s largest IT services firm reiterated its ambition to become the world’s largest AI-led technology services company. At the time of writing, TCS shares were trading at Rs 3,277.90, up Rs 60.10, or 1.87 per cent.

For the first time, TCS disclosed key metrics to quantify the scale of its AI business. The company said it has executed more than 5,000 AI engagements so far. AI-related services are generating about $1.5 billion in annualised revenue, accounting for roughly 5 per cent of total revenues. This compares with around 3 per cent advanced AI revenues reported by peers.

AI revenues are growing faster than the core business. Growth stood at 16.3 per cent quarter on quarter and 38.2 per cent year on year in constant currency terms.

TCS said its new-age services portfolio, including AI and cybersecurity, is contributing around $11 billion in annualised revenue. The company said it is prepared to build capabilities organically, including in data centre-related businesses, and also pursue acquisitions. It cited recent acquisitions such as ListEngage and Coastal Cloud.

The company currently has an investible surplus of over $6.3 billion.

TCS maintained its operating margin aspiration band of 26–28 per cent. Management said the focus remains on driving growth with profitability, while continuing to invest. It also reiterated its goal of returning 80–100 per cent of free cash flow to shareholders.

AI remained the central theme at the analyst day. The company said around 85 per cent of its large clients, with over $20 million in revenue each, are already using AI solutions. TCS has trained around 1.8 lakh employees in AI skills, out of a total workforce of about 6 lakh.

Morgan Stanley maintained its ‘Overweight’ rating on TCS, with a target price of Rs 3,430. The brokerage said the enterprise AI journey is still at an early stage, where TCS is well positioned to play a key role.

UBS maintained a ‘Neutral’ rating, with a target price of Rs 3,435.