|in Rs||Rs crore||% chg||Change|
|Price on NSE as on January 13, 2017.|
|% chg, change over March 31, 2009|
TCS stock appreciated a massive 733 per cent since March 31, 2009, compared with 195 per cent jump in peer Infosys and 229 per cent in Wipro.
HCL Technologies, the fourth largest IT firm, remained the only close peer (up 1571 per cent) which raced past the IT major on return front.
TCS remained the most valued firm on BSE in Chandrasekaran’s tenure. TCS’ market capitalisation swelled by a whopping Rs 3.90 lakh crore under Chandrasekaran to Rs 4.43 lakh crore at close on Friday. TCS was the first Indian company to cross the Rs 5 lakh crore mark in market capitalisation on July 23, 2014.
HCL Technologies and Infosys have seen less than Rs 1.5 lakh crore gains in their respective m-caps, while Wipro’s m-cap was up Rs 81,862 crore.
TCS’ consolidated net profit increased more than four-fold from Rs 5,256 crore in financial year 2008-09 (FY09) to Rs 24,292 crore in FY16. Infosys and Wipro’s net profit more than doubled during the same period.
TCS posted consolidated net profit of Rs 19,735 crore in first nine months (April to December) of the current financial year 2016-17 (FY17), while Infosys reported profit of Rs 10,749 crore in the same period.
On Friday, TCS stock settled 4% lower at Rs 2,249 as the change in management overshadowed the robust earnings growth in Q3.
Brokerage view on Q3 and management change
Brokerage HDFC Securities expects the stock to remain range bound in the near-term as leadership rejig and relative stability in BFSI segment may restrict meaningful upside or downside in the stock.
"Incoming CEO and current CFO Rajesh Gopinathan has wide experience ranging from business to finance within TCS. However, filling in Chandra's shoes will be a challenging task," said analysts at Antique Stock Broking.
Brokerage Reliance Securities believes management change at this juncture is not prudent.
"In a time marked with multiple challenges and key headwinds impacting the IT sector, this is not an apt moment to rock the boat for TCS, especially considering Chandrasekaran’s vast expertise and CEO and board-level connect with major clients. Though we realise this is a strategic decision taken with a view to stabilising the turbulent waters at Group level, we remain concerned about the consequential impact on TCS,” said the brokerage.
Vaibhav Agrawal, head of research, Angel Broking, said, “TCS, under Chandrasekaran’s leadership, consistently reported strong financials, return ratios and has become most valuable company in India. This is something that indicates successful track record of the new Chairman at Tata Sons.”
|Company||Revenues (Rs crore)||Net profit (Rs crore)||Revenues||Net profit|
|FY09||FY16||FY09||FY16||9 months||9 months|
|*FY09 - ended June 2008, FY16 results for nine months ended March 2016.|
|# 9 months (April - December) of FY17.|
|Source: CapitalinePlus Data compiled by BS Research|