TCS shares up on agreement with Mitsubishi Corp

Shares of Tata Consultancy Services (TCS) surged in morning trade today after the software services firm signed an agreement with Japanese major Mitsubishi Corporation.
TCS today said it has signed an agreement with Japanese major Mitsubishi Corporation to form a single IT services unit.
The merger, in which TCS will hold 51 per cent stake and Mitsubishi 49 per cent, will create a new IT services company of significant scale in the Japanese market with annual turnover of over USD 600 million.
Reacting to the development, shares of the company opened on a bullish note and jumped as much as 1.10 per cent to touch an early high of Rs 2,242 on the BSE.

Similar movement was seen on the National Stock Exchange as well, where the stock opened at Rs 2,220 and then gained 0.89 per cent to touch an early high of Rs 2,242.90.
Marketmen said the uptrend in the stock was largely a knee jerk reaction to the TCS, Mitsubishi agreement.
"This strategic transaction signifies our serious commitment to the Japan market. TCS will now have the scale, strong local presence and full range of global capabilities to serve the Japanese corporations effectively and accelerate our growth in Japan market," TCS CEO and Managing Director N Chandrasekaran said.