October 12, 2018 / 4:17 AM / 4 months ago

CORRECTED-BUZZ-India's TCS hits 3-mth low; co posts record Q2 profit but margin woes remain

(Corrects headline to say TCS hits 3-month low, not falls most in over 2 months)

** Top software services exporter Tata Consultancy Services Ltd (TCS) shares fall as much as 2.9 pct to 1,922.35 rupees, their lowest level since July 11

** Co’s Q2 record profit of 79.01 bln rupees ($1.07 bln) beat estimates on Thursday, helped by revenues from retail sector and banking, financial services and insurance clients

** Co sees double-digit revenue growth in this financial year

** Jefferies cuts PT to 2,300 rupees from 2,315 rupees citing EBIT margin of 26.5 pct missing their expectation on lower operational efficiency gains

** Nomura expects marginal downside to consensus growth numbers and possible tempering of multiples, given the shift in liquidity scenario; maintains “reduce” rating with PT of 1,950 rupees

** Macquarie, however, expects co to post strongest organic growth of Tier-1 pack; believe TCS’ premium valuations can be sustained on the back of this

** Macquarie maintains “outperform” rating with PT of 2,345 rupees

** More than 1.9 mln shares change hands in first half an hour of trading as of 0402 GMT, compared with 30-day avg of 2.7 mln shares

** 22 of 45 brokerages covering the stock rate it “buy” or higher, 16 “hold” and seven “sell” or lower; their median PT is 2,060 rupees ($1 = 74.0400 Indian rupees)

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