TCS Share Price Live Updates: Data center foray has limited IT services synergies, Jefferies says

Jefferies has maintained its “hold” rating on TCS with a price target of ₹3,100.

It said that growth in key markets is yet to recover, and that a 3% sequential decline in headcount does not bode well for the company.

TCS’ data center foray has limited synergies with IT Services, according to Jefferies, and as a result, it has cut its estimates by up to 1% and expects TCS’ Earnings Per Share (EPS) to grow at a Compounded Annual Growth Rate (CAGR) of 4% over financial year 2026-2028.

– Maintain ‘sell’ rating

– Price target of ₹2,800

– Revenue supported by higher equipment and software share

– Announced investments in data centers and intensity set to increase

– Business outlook is challenged

– Upgrade to buy

– Price target of ₹3,700

– Deal win momentum remains strong

– Management growth outlook is optimistic despite continued pressure on discretionary spends

– AI data centre announced carries significant potential & also risks

– Maintain revenue and margin estimates for FY26 and FY27

– Restructuring-related costs linked to severance at ₹1,135 crore

– International market revenue growth at 0.6% sequentially

– The company did not disclose its US Dollar revenue

– Revenue in rupee terms increased by 3.7% from last year to ₹65,799 crore

– EBIT at ₹16,565 crore from ₹15,514 crore

– EBIT margin at 25.2% from 24.5%

– Net profit down 5.4% to ₹12,075 crore

– All numbers compared quarter-on-quarter

The results were better than expectations on most fronts, but there were multiple announcements made along with the results that could grab the spotlight.

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TCS Share Price Live Updates: Data center foray has limited IT services synergies, Jefferies says