TCS rises on prospects for market share gain

BANGALORE Tue Apr 24, 2012 1:14pm IST

1 of 2. Workers are seen at their workstations on the floor of an outsourcing centre in Bangalore, February 29, 2012.

Credit: Reuters/Vivek Prakash/Files

Related Topics

Stocks

   

BANGALORE (Reuters) - Shares in Tata Consultancy Services shot up as much as 12.4 percent on Tuesday, a day after India's top software services exporter said it expects to outperform the sector outlook, an indication it is poised to gain at the expense of rival Infosys(INFY.NS).

TCS' 23 percent rise in fiscal fourth-quarter profit, reported after markets closed on Monday, was in line with expectations.

However, the company's comments on its near-term prospects were far more bullish than those of Infosys, which on April 13 missed its own revenue guidance and gave a worse-than-expected forecast for the year ending next March.

"Solid, but appears to be inline, quarter. We believe confirms our view that Infosys (INFY) is losing share. TCS' wage plan will further challenge INFY, in our view," Wells Fargo Securities analysts said in a note after TCS' earnings report.

Several domestic brokerages including Enam Securities, HDFC Securities and B&K Securities upgraded their share ratings of TCS to "buy" from "hold" or "underperform" ratings before the results.

Infosys shares fell nearly 5 percent on Tuesday morning before pushing into positive territory. They had tumbled as much as 12.5 percent the day the company posted earnings early this month.

Tata Consultancy, which gave an average 8 percent salary increase to its staff in India and announced plans to hire 50,000 people this fiscal year, is on track to grow faster than the sector, Chief Executive N. Chandrasekaran told reporters on Monday.

India's $100-billion-a-year information technology and back office services sector will grow 11-14 percent in the current fiscal year ending March, the National Association of Software and Service Companies, or Nasscom, an industry group, estimates.

TCS shares were up 11.7 percent at 1:01 p.m. (0731 GMT) in a broader market that was up just over 0.6 percent.

Third-ranked Wipro will report earnings Wednesday.

(Additional reporting By Abhishek Vishnoi in MUMBAI; Editing by Ranjit Gangadharan Aradhana Aravindan)

FILED UNDER:
  • Most Popular
  • Most Shared

Pending Reform

REUTERS SHOWCASE

Power Theft

Power Theft

India to invest $4 billion to tackle power theft  Full Article 

Debt Funds

Debt Funds

India monitors foreign flows into debt funds, may tighten rules  Full Article 

Bulgari Back in India

Bulgari Back in India

CEO: we shouldn’t have left India so we’re back  Full Article 

 Hindu "Modi-fication"

Hindu "Modi-fication"

Fears grow about Hindu "Modi-fication" of education  Full Article 

Weak Credit

Weak Credit

Hard to hit tax revenue target, credit weak - Jaitley  Full Article 

China Rate Cut

China Rate Cut

China surprises with interest rate cut to spur growth  Full Article 

Gold Imports

Gold Imports

RBI cautious on response to gold import surge  Full Article 

Economic Corridor

Economic Corridor

China commits $45.6 billion for economic corridor with Pakistan  Full Article 

Overseas Funds

Overseas Funds

RBI says overseas borrowed funds can be parked with banks in India  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage