Tata Consultancy Services (TCS) surged past the Rs 6 lakh-crore-mark in market valuation on Wednesday, becoming the second company to achieve the milestone after Reliance Industries (RIL).
Tata Consultancy Services (TCS) surged past the Rs 6 lakh-crore-mark in market valuation on Wednesday, becoming the second company to achieve the milestone after Reliance Industries (RIL). The TCS stock rallied as much as 4.9% during the day trade on the BSE to briefly pip the market cap of RIL. On the other hand, the Reliance Industries stock declined over 2% during the session. At the end of the session, the market capitalisation (m-cap) of TCS market stood at Rs 6.08 lakh crore against the RIL’s market cap of Rs 6.11 lakh crore. Shares of the IT major rose by 2.30% to end at Rs 3,174.60 on BSE. Intra-day, it gained 4.88% to Rs 3,254.80 — its 52-week high. The company had briefly surpassed RIL to become the country’s most valued firm in terms of market valuation during the afternoon trade on BSE. Shares of TCS has been on a roll ever since a Morgan Stanley report predicted that Indian IT services stocks may be set for a turnaround this year. IT research firm, Gartner, too released its report, which envisages growth rate in global IT spends accelerating in 2018. Analysts at Morgan Stanley observed in a report that technology spending may be buoyed by an improving global macro environment, leading to a re-rating of the industry’s stocks, which are trading at or below long-term average valuations.
So far in January, TCS yielded a return of 17.6% against a gain of 4.7% by RIL. The Sensex rose 6.2% during the period. The investors sentiment also got a boost after the IT major won a series of orders in the past few weeks. The company last week bagged a $690-million contract from M&G Prudential, following another announcement of a $2.25-billion win earlier this month. Morgan Stanley analysts said the $2.25-bn deal win indicates potential conversion of deal pipelines. The note further said an improvement in BFSI/Retail verticals should help TCS. RIL posted a record consolidate net profit in third quarter FY18, aided by first ever profit at its telecom business — Jio. Analysts at Deutsche Bank believe the street still has not fully factored in the impact of a sharp increase in the revenue market-share in telecom, the launch of fiber broadband in FY19 and the potential upside to RIL’s refining margins.