Tata Consultancy Services wealth erosion tops $100 billion from peak

TCS loses over $100 billion in market value from its 2022 peak as AI uncertainty and IT sector correction trigger a sharp valuation reset

In a first for a domestically listed company, the market capitalisation (mcap) of Tata group flagship Tata Consultancy Services (TCS) has fallen by more than $100 billion from its peak.

 

At its high on January 17, 2022, the information technology (IT) bellwether was valued at $200.15 billion. At the latest close, its mcap stood at about $99 billion (₹9.09 trillion), reflecting a sharp erosion in investor wealth. 

The decline comes amid a cloud of uncertainty hanging over Indian IT services companies as investors assess the potential impact of artificial intelligence (AI) on traditional outsourcing models. 

While TCS is widely held by institutional as well as retail investors, the biggest hit from the $100 billion erosion has been to promoter Tata Sons, which holds a 71.77 per cent stake in the software exporter. 

Like its peers, TCS shares have seen a sharp valuation reset. The stock currently trades at a 12-month forward price-to-earnings (P/E) multiple of about 19 times, compared with nearly 40 times at its peak. In rupee terms, the stock is down about 45 per cent from its high.

 

Other IT majors have also seen steep declines. Shares of Infosys, HCL Technologies, and Wipro are down between 32 per cent and 44 per cent from their respective peaks. In comparison, the Nifty IT index has fallen around 35 per cent from its high while the benchmark Nifty 50 has declined about 8 per cent.

 

TCS was only the second Indian company to cross the $200 billion mcap mark after Reliance Industries, which remains the only firm currently above that level.

 

The recent market rout has also shrunk India’s $100 billion mcap club, with TCS and ICICI Bank slipping below the threshold. Reliance Industries, HDFC Bank, Bharti Airtel, and State Bank of India are now the only companies in the $100 billion-plus league.