Friday 10 July 2015

TCS Q1: Brokerages Give Thumbs-Up Despite Mixed Earnings

Tata Consultancy Services missed revenue growth estimates in the June quarter, but India's biggest outsourcer beat profitability estimates.

Here's what leading brokerages have to say about TCS Q1:

CLSA reiterated "buy" on TCS, says TCS has started with a slower sprint this year. Q1 revenue was a miss, but the company reported strong margins, it added.

Credit Suisse says TCS continues to be a core holding. Near-term stock performance could be constrained and premium to Infosys can contract after recent expansion, it added.

Kotak says TCS is well-placed for a bounce-back. Revenues a tad off the track, but core growth intact, it said. Multiple quarters of revenue miss is a concern, Kotak added.

Morgan Stanley said valuations are full leaving limited upside for TCS.

Deutsche Bank says TCS has made a steady start to FY16 with impressive margin beat. For Deutsche Bank, TCS is top "buy" in IT space with target price of Rs 2,900.

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