Generic selectors
Exact matches only
Search in title
Search in content
Post Type Selectors
post
Last Updated on: 25 June, 2024|Author: Getaka | Social: X Twitter Profile
Stock Ticker - BSE: 532540 | NSE: TCS

Fundamental Analysis of Tata Consultancy Services Ltd

Basic Stock Data

Last Updated: June 18, 2024, 11:42 am

Market Cap 13,83,701 Cr.
Current Price 3,824
High / Low4,255/3,172
Stock P/E29.8
Book Value 250
Dividend Yield1.45 %
ROCE64.3 %
ROE51.5 %
Face Value 1.00
PEG Ratio4.05

Competitors of Tata Consultancy Services Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Intellect Design Arena Ltd 14,695 Cr. 1,0751,199/57244.6 1780.33 %20.3 %14.7 % 5.00
Subex Ltd 1,750 Cr. 31.045.8/22.4 5.920.00 %5.35 %13.5 % 5.00
Brightcom Group Ltd 1,893 Cr. 9.3833.1/8.591.34 34.70.00 %30.9 %22.3 % 2.00
Trejhara Solutions Ltd 286 Cr. 197223/66.0115 1520.00 %1.66 %1.19 % 10.0
Cressanda Railway Solutions Ltd 437 Cr. 10.531.2/9.5546.3 2.990.00 %11.1 %8.37 % 1.00
Industry Average22,556.88 Cr690.3466.22123.420.70%19.80%19.46%6.86

Quarterly Result

MonthDec 2020Mar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023
Sales42,01543,70545,41146,86748,88550,59152,75855,30958,22959,16259,38159,69260,583
Expenses29,80730,90432,74833,75135,45236,74639,34240,79342,67643,38844,38343,94644,195
Operating Profit12,20812,80112,66313,11613,43313,84513,41614,51615,55315,77414,99815,74616,388
OPM %29%29%28%28%27%27%25%26%27%27%25%26%27%
Other Income6919317211,1111,2059817899655201,1751,3971,006-96
Interest183138146142251245199148160272163159230
Depreciation1,0241,0671,0751,1161,1961,2171,2301,2371,2691,2861,2431,2631,233
Profit before tax11,69212,52712,16312,96913,19113,36412,77614,09614,64415,39114,98915,33014,829
Tax %25%26%26%26%26%25%25%26%26%26%26%26%25%
Net Profit8,7279,2829,0319,6539,8069,9599,51910,46510,88311,43611,12011,38011,097
EPS in Rs23.1925.0024.3526.0226.4127.1325.9028.5129.6431.1330.2631.0030.56

Last Updated: June 5, 2024, 12:18 pm

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: May 28, 2024, 8:58 pm

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023TTM
Sales48,89462,98981,80994,648108,646117,966123,104146,463156,949164,177191,754225,458238,818
Expenses34,45944,95056,65770,16777,96985,65590,588106,957114,840117,631138,697166,199175,912
Operating Profit14,43518,04025,15324,48230,67732,31132,51639,50642,10946,54653,05759,25962,906
OPM %30%29%31%26%28%27%26%27%27%28%28%26%26%
Other Income4281,1781,6373,7203,0844,2213,6424,3114,5921,9164,0183,4493,482
Interest224839104333252198924637784779824
Depreciation9181,0801,3491,7991,8881,9872,0142,0563,5294,0654,6045,0225,025
Profit before tax13,92318,09025,40226,29831,84034,51334,09241,56342,24843,76051,68756,90760,539
Tax %24%22%24%24%24%24%24%24%23%26%26%26%
Net Profit10,52314,07619,33220,06024,33826,35725,88031,56232,44732,56238,44942,30345,033
EPS in Rs26.6035.5548.9250.6861.5866.7167.4683.8786.1987.67104.75115.19122.95
Dividend Payout %47%31%33%78%35%35%37%36%85%43%41%100%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2012-20132013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-2023
YoY Net Profit Growth (%)33.76%37.34%3.77%21.33%8.30%-1.81%21.96%2.80%0.35%18.08%10.02%
Change in YoY Net Profit Growth (%)0.00%3.58%-33.57%17.56%-13.03%-10.11%23.76%-19.15%-2.45%17.72%-8.06%

Growth

Compounded Sales Growth
10 Years:11%
5 Years:10%
3 Years:14%
TTM:7%
Compounded Profit Growth
10 Years:9%
5 Years:8%
3 Years:12%
TTM:11%
Stock Price CAGR
10 Years:12%
5 Years:11%
3 Years:4%
1 Year:20%
Return on Equity
10 Years:40%
5 Years:44%
3 Years:47%
Last Year:52%

Last Updated: June 18, 2024, 10:13 am

Tata Consultancy Services Ltd Balance Sheet

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Sep 2023
Equity Capital196196196196197197191375375370366366366
Reserves29,28438,35048,99950,43970,87586,01784,93789,07183,75186,06388,77390,058100,315
Preference Capital1001000000000000
Borrowings127232297358245289247628,1747,7957,8187,6887,764
Other Liabilities11,55113,15417,33722,32516,97415,83019,75124,39327,82035,76443,96744,74746,495
Total Liabilities41,15751,93266,82973,31888,291102,333105,126113,901120,120129,992140,924142,859154,940
Fixed Assets8,6629,8289,54411,63811,77411,70111,97312,29020,92821,02121,29820,51519,568
CWIP1,4461,8953,1682,7661,6701,5411,2789639069261,2051,2341,408
Investments1,3501,8973,4341,66222,82241,98036,00829,33026,35629,37330,48537,16344,083
Other Assets29,69838,31250,68257,25252,02547,11155,86771,31871,93078,67287,93683,94789,881
Total Assets41,15751,93266,82973,31888,291102,333105,126113,901120,120129,992140,924142,859154,940

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity 11,61514,75119,36919,10925,22325,06728,59332,36938,80239,94941,96544,338
Cash from Investing Activity -6,038-9,452-1,807-5,010-16,8953,1041,6458,968-7,956-7385486,026
Cash from Financing Activity -5,729-5,673-17,168-9,666-11,026-26,885-27,897-39,915-32,634-33,581-47,878-48,536
Net Cash Flow-152-3743944,433-2,6981,2862,3411,422-1,7885,630-5,3651,828

Free Cash Flow

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Free Cash Flow-86.00-82.0025.0024.0030.0032.0032.0039.0042.0046.0053.0059.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Debtor Days868281798170746871678081
Inventory Days
Days Payable
Cash Conversion Cycle868281798170746871678081
Working Capital Days457052336263617067623633
ROCE %50%52%56%50%51%44%39%47%47%49%54%59%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthJun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024
Promoters72.19%72.19%72.19%72.30%72.30%72.30%72.30%72.30%72.30%72.30%72.41%71.77%
FIIs15.43%15.37%14.98%14.15%13.50%13.05%12.94%12.72%12.46%12.47%12.46%12.70%
DIIs7.97%7.89%7.93%7.81%8.36%8.53%9.25%9.58%9.80%10.01%10.03%10.61%
Government0.04%0.04%0.04%0.04%0.05%0.05%0.05%0.05%0.05%0.05%0.05%0.06%
Public4.38%4.51%4.86%5.70%5.80%6.06%5.45%5.36%5.38%5.17%5.03%4.86%
No. of Shareholders11,30,83412,28,54015,77,35824,74,31025,02,38527,03,96625,56,97024,99,38425,02,83523,67,00323,36,01622,03,209

Shareholding Pattern Chart

No. of Shareholders

Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
SBI Nifty 50 ETF18,313,7554.317499.674,485,8082024-06-24308.26%
SBI S&P BSE Sensex ETF13,065,3905.065346.554,485,8082024-06-24191.26%
Axis ELSS Tax Saver Fund6,125,8797.372508.614,485,8082024-06-2436.56%
UTI Nifty 50 ETF5,104,4194.312090.314,485,8082024-06-2413.79%
UTI S&P BSE Sensex ETF4,566,1755.061868.554,485,8082024-06-241.79%
ICICI Prudential Technology Fund4,519,35315.141850.724,485,8082024-06-240.75%
Axis Bluechip Fund4,485,8085.631836.984,485,8082024-06-240%
Tata Digital India Fund3,503,87314.251434.874,485,8082024-06-24-21.89%
Kotak Flexicap Fund - Regular Plan2,900,0002.631187.584,485,8082024-06-24-35.35%
Axis Focused 25 Fund2,792,8448.451143.74,485,8082024-06-24-37.74%

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue1.001.001.001.001.00
Basic EPS (Rs.)125.88115.19103.6286.7186.19
Diluted EPS (Rs.)125.88115.19103.6286.7186.19
Cash EPS (Rs.)141.12129.30117.6398.9995.94
Book Value[Excl.RevalReserv]/Share (Rs.)252.26249.20245.48235.43226.00
Book Value[Incl.RevalReserv]/Share (Rs.)252.26249.20245.48235.43226.00
Revenue From Operations / Share (Rs.)665.45616.01523.92443.72418.53
PBDIT / Share (Rs.)189.83171.33155.94134.27124.54
PBIT / Share (Rs.)176.06157.61143.36123.28115.13
PBT / Share (Rs.)171.26155.48141.22118.27112.66
Net Profit / Share (Rs.)127.35115.58105.0588.0186.53
NP After MI And SOA / Share (Rs.)126.82115.16104.7287.6586.24
PBDIT Margin (%)28.5227.8129.7630.2629.75
PBIT Margin (%)26.4525.5827.3627.7827.50
PBT Margin (%)25.7325.2426.9526.6526.91
Net Profit Margin (%)19.1318.7620.0519.8320.67
NP After MI And SOA Margin (%)19.0518.6919.9819.7520.60
Return on Networth / Equity (%)50.7346.6142.9937.5238.44
Return on Capital Employeed (%)63.5157.6352.9147.2146.00
Return On Assets (%)31.3429.3327.0824.8026.74
Asset Turnover Ratio (%)1.661.581.271.181.19
Current Ratio (X)2.452.532.562.913.33
Quick Ratio (X)2.452.532.562.913.33
Dividend Payout Ratio (NP) (%)54.7598.1034.7433.45116.36
Dividend Payout Ratio (CP) (%)49.3987.6531.0129.73104.92
Earning Retention Ratio (%)45.251.9065.2666.55-16.36
Cash Earning Retention Ratio (%)50.6112.3568.9970.27-4.92
Interest Coverage Ratio (X)88.3380.5072.8077.9950.54
Interest Coverage Ratio (Post Tax) (X)61.4855.3050.0454.0336.12
Enterprise Value (Cr.)1393389.101163072.801350886.801167058.00674600.75
EV / Net Operating Revenue (X)5.785.167.047.114.30
EV / EBITDA (X)20.2818.5523.6723.4914.45
MarketCap / Net Operating Revenue (X)5.845.207.147.164.36
Retention Ratios (%)45.241.8965.2566.54-16.36
Price / BV (X)15.5412.9815.3513.608.13
Price / Net Operating Revenue (X)5.845.207.147.164.36
EarningsYield0.030.030.020.020.04

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value: 3,892.38

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

Undervalued: 1.79% compared to the current price 3824

Intrinsic Value: 4,178.98

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators along with EPS growth.

Undervalued: 9.28% compared to the current price ₹3824

Last 5 Year EPS CAGR: 7.36%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a high average ROCE of 49.83%, which is a positive sign.
  2. The company has higher reserves (72,840.92 cr) compared to borrowings (15.38 cr), indicating strong financial stability.
  3. The company has shown consistent growth in sales (134.85 cr) and profit (36.46 cr) over the years.
  1. The stock has a high average Working Capital Days of 54.50, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 76.67, which may not be favorable.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in Tata Consultancy Services Ltd:
    1. Net Profit Margin: 19.13%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 63.51% (Industry Average ROCE: %)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 50.73% (Industry Average ROE: %)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 61.48
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 2.45
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. ✗ Stock P/E: 29.8 (Industry average Stock P/E: )
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. ✗ Total Debt / Equity: N/A
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Qualitative Analysis

Tata Consultancy Services Ltd. is a Public Limited Listed company incorporated on 19/01/1995 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L22210MH1995PLC084781 and registration number is 084781. Currently Company is involved in the business activities of Computer programming, consultancy and related activities. Company’s Total Operating Revenue is Rs. 160341.00 Cr. and Equity Capital is Rs. 366.00 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
IT Consulting & Software9th Floor, Mumbai Maharashtra 400021investor.relations@tcs.com
https://www.tcs.com
Management
NamePosition Held
Mr. Keki M MistryInd. Non-Executive Director
Mr. N ChandrasekaranChairman
Mr. K KrithivasanManaging Director & CEO
Mr. N G SubramaniamExe.Director & COO
Ms. Aarthi SubramanianNon Exe.Non Ind.Director
Mr. O P BhattInd. Non-Executive Director
Dr. Pradeep Kumar KhoslaInd. Non-Executive Director
Ms. Hanne SorensenInd. Non-Executive Director
Mr. Al-Noor RamjiInd. Non-Executive Director

FAQ

What is the latest fair value of Tata Consultancy Services Ltd?

The latest fair value of Tata Consultancy Services Ltd is ₹3892.38.

What is the Market Cap of Tata Consultancy Services Ltd?

The Market Cap of Tata Consultancy Services Ltd is 13,83,701 Cr..

What is the current Stock Price of Tata Consultancy Services Ltd as on 25 June 2024?

The current stock price of Tata Consultancy Services Ltd as on 25 June 2024 is ₹3,824.

What is the High / Low of Tata Consultancy Services Ltd stocks in FY 2024?

In FY 2024, the High / Low of Tata Consultancy Services Ltd stocks is 4,255/3,172.

What is the Stock P/E of Tata Consultancy Services Ltd?

The Stock P/E of Tata Consultancy Services Ltd is 29.8.

What is the Book Value of Tata Consultancy Services Ltd?

The Book Value of Tata Consultancy Services Ltd is 250.

What is the Dividend Yield of Tata Consultancy Services Ltd?

The Dividend Yield of Tata Consultancy Services Ltd is 1.45 %.

What is the ROCE of Tata Consultancy Services Ltd?

The ROCE of Tata Consultancy Services Ltd is 64.3 %.

What is the ROE of Tata Consultancy Services Ltd?

The ROE of Tata Consultancy Services Ltd is 51.5 %.

What is the Face Value of Tata Consultancy Services Ltd?

The Face Value of Tata Consultancy Services Ltd is 1.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in Tata Consultancy Services Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE