- Last month, TCS made history when its market value hit $100 billion
- It was the first Indian IT company to hit the milestone
- Optimism over global IT spending, weaker rupee has boosted IT stocks
The market value of Tata Consultancy Services (TCS) today hit a new milestone of Rs 7 lakh crore after its share price rallied to a fresh 52-week high. TCS shares gained as much as 2 per cent today to Rs 3,674, rising for a second straight day. TCS share price had jumped over 3 per cent on Thursday as the recent bout of weakness in the rupee lifted IT shares. Mumbai-based TCS, which is celebrating 50 years of being in business, is a unit of Tata Group, one of India's oldest companies that now sells cars, power, tea and chemicals through its various subsidiaries.
Last month, India's biggest IT company TCS made history when its market value hit the $100 billion mark, becoming the first Indian IT company to hit the milestone. Energy-to-telecom conglomerate Reliance Industries, led by India's richest man Mukesh Ambani, had breached the $100 billion mark way back in 2007.
TCS shares have hugely outperformed the overall market in the past six months as IT stocks came back into favour with investors. Shares of TCS have risen over 35 per cent in the past six months as compared to a mere 3 per cent rise in Sensex.
Optimism over global IT spending, weakness in the rupee and record quarterly profit in the January-March period have boosted the sentiment in TCS shares, say analysts.
Last month after its earnings announcement, Tata Consultancy Services' management had said that it expects a rebound in spending by its key banking, financial services and insurance (BFSI) clients this financial year, helped by strong demand for technology related to security, blockchain and analytics.
Rahul Agarwal, director at Wealth Discovery, says the current slide in the rupee vis-a-vis the US dollar has been a "blessing in disguise for the Indian IT majors" as it makes Indian IT exports more competitive.
"It has been a shot in the arm for the country's information technology sector which has been battered in last two years by a broader slowdown in technology spending and issues such as the H-1B visa worries. Things are beginning to look up - especially after the recent quarterly earnings, which have shown positive momentum," he adds.
TCS shares could not sustain the gains today, ending 0.4 per cent lower at Rs 3,589.
Get the latest election news, live updates and election schedule for Lok Sabha Elections 2019 on ndtv.com/elections. Like us on Facebook or follow us on Twitter and Instagram for updates from each of the 543 parliamentary seats for the 2019 Indian general elections.