TCS shares rose 2.35% to ₹2,252.70 on Monday, marking a notable price rise in early trade and placing the stock among the Nifty 50 constituents. The positive momentum came after the IT major reported strong Q1 earnings and announced a multi-million-dollar AI-led network transformation deal with ABB. TCS shares have gained 7% in two sessions and 11% from their July low, though they remain down around 32% in 2026 so far. The stock also received additional support after Kotak Institutional Equities added it to its large-cap model portfolio with a 150 basis-point weight, citing 18% upside potential on attractive valuations following the stock's underperformance. As per CNBC TV18, the brokerage noted the inclusion is aimed at reducing its large underweight on IT and does not amount to an endorsement of the sector, while flagging limited visibility on AI-led deflation and margin pressures.
TCS reported consolidated net profit of ₹13,420 crore for Q1FY27, representing a 2.64% decrease from the previous quarter, with the company beating revenue estimates for the April-June period. Revenue from operations rose 2.23% year-on-year to ₹72,275 crore and was up from ₹70,698 crore in the March quarter. Net income rose 8.5% year-on-year to ₹13,849 crore after excluding exceptional items. Operating profit (EBIT) declined 3.1% sequentially to ₹17,317 crore, while the EBIT margin narrowed 130 basis points to 24% from 25.3% in the previous quarter, reflecting pressure on profitability despite revenue growth. The company ended the quarter with a workforce of 593,798 employees and attrition in its IT services business stood at 13.6% over the last 12 months. Additionally, TCS declared an interim dividend of ₹12 per equity share with the record date fixed as July 15 and dividend payment scheduled for July 31.
TCS reported annualised AI revenue of USD 2.6 billion in Q1FY27, up 13.6% from the previous quarter, driven by AI-led transformation deals. The company secured key AI-led business wins including an USD 800-million deal with SKF, a multi-million-dollar strategic partnership with ServiceNow and another multi-million-dollar agreement with a Europe-based Fortune Global 50 company. The total contract value of deals signed during the June quarter stood at USD 9.5 billion, including the marquee AI-led transformation deal with SKF. CEO K Krithivasan noted that Q1FY27 reflects continued growth momentum despite geopolitical and macro-economic headwinds, with the company delivering a strong order book of $9.5 billion, including a marquee AI-led transformation deal with SKF, while scaling its AI business to a $2.6 billion annualised revenue run rate. Analysts said investors were encouraged by the company's growth outlook, supported by rising AI-led business, strength in the banking, financial services and insurance segment, the high-tech vertical and regional markets.
Tata Consultancy Services announced an expanded collaboration with ABB on July 13, marking the next phase of their trusted 20-year partnership. Under a multi-million dollar, multi-year agreement, TCS will take on a broader role in managing ABB's global network operations, representing a significant escalation from managing infrastructure and applications to delivering end-to-end global network operations through an integrated network-as-a-service model. As a strategic programme partner, TCS will design, integrate, and run ABB's global network ecosystem as a secure, modern, and AI-driven service, orchestrating ABB's multi-vendor environment to ensure seamless, standardised operations worldwide. The deal value was not disclosed in the latest announcement, as reported by CNBC TV18. The engagement centers on ABB's Future Network Model programme, an enterprise-wide initiative to transform its global network into a standardised, centrally managed digital infrastructure. As part of the engagement, TCS will design, integrate and operate ABB's worldwide network ecosystem using AI-enabled capabilities while managing a multi-vendor environment.
TCS announced significant organizational changes with the split of its banking and financial services Americas business into two units, with Rakesh Kumar heading the US West banking business and Mohan Veeturi leading the US East banking business. Current US banking head Susheel Vasudevan will move to a strategic role reporting to the chief executive, while Manmeet Chhabra will take over as Canada country head. The company also appointed new leaders for its cybersecurity business and the UK and Europe life sciences and communication and media verticals. Additionally, TCS announced the creation of five new business groups covering the ServiceNow practice, travel and transport, energy and utilities, the US West Coast, and global autonomous businesses, each with dedicated leadership. These changes come at a time when artificial intelligence is expected to reshape the IT services industry by reducing project timelines, improving productivity and changing client spending patterns.
Technical indicators are showing encouraging signs of momentum improvement. As per The Economic Times, the RSI has broken above a horizontal resistance trendline and is moving higher, while the MACD histogram bars have started to expand, signalling a build-up in bullish momentum. However, analysts remain divided on whether this rally marks a sustained trend reversal. Shah cautioned that it is still premature to classify this as a confirmed trend reversal, noting that the 2,190–2,200 zone is likely to act as immediate resistance. Unless the stock manages to decisively break and sustain above this zone, the probability of a meaningful short-term trend reversal remains low. Harshal Dasani from INVasset PMS maintains a bearish stance until either ₹2,300 resistance breaks with conviction and volume, or ₹1,976 support holds through multiple retests with visible volume drying up on each attempt. Nishchal Jain from Share.Market by PhonePe had previously noted that TCS has shown signs of structural stabilisation after rebounding from its recent 52-week lows, with charts indicating a solid consolidation base forming a critical support level near ₹1,980.
