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Tata Sons Raising Rs 9,000 Crore From Its Biggest Stock; Future Of Tata Share

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Tata Consultancy Services Ltd (NSE: TCS): Tata Consultancy Services (TCS) shares reached a record high of 4254.45 in the BSE; an investor banking expert released the term sheet of a block deal that Tata Sons was looking to sell 2.43 crore shares of the software firm. 

The following day, a major block deal of around Rs 9000 crore was revealed and Tata Sons is believed to have sold approximately 2.02 crore shares for an average cost of Rs 4043 per share.

The effect of the cash withdrawals by the promoter was also felt by the shares, even though it was a mere 0.6 percent equity loss out of a 72.38 percent stake. 

TCS shares have dropped over 6 percent since their high in only the span of two sessions.

The company is a holding firm of Tata Companies, out of which Tata Chemicals, Tata Consumer, and TCS are considered to be the most stock that has cash. 

The company generated a standalone profit of about 35,000 crores in FY23, and the majority of it came from dividends.

A majority of them came from TCS which paid 33,306 crore in dividends for shareholders in the past fiscal year.

However, the salt-to-software group hasn’t yet made public the motivations for this stake auction. 

Here are the four possible explanations why Tata might have been forced to dispose of a small portion of the silver his family-owned.

The Investment Plans To Fund Ambitious Projects For The Development

Under the direction of Chairman N Chandrasekaran Tata Group has demonstrated an endless appetite for growth in the new areas of semiconductors and digital technology. 

Tata Electronics, a subsidiary of Tata Sons, has committed to invest Rs 91,000 crore to construct a semiconductor fabrication facility situated in Dholera, Gujarat. 

The company is also planning for a capital investment of $1 billion into Tata Digital in the next couple of years.

Reduce Debt And Steer Clear Of IPO 

The balance sheet for FY23 of Tata Sons shows borrowings of around the amount of Rs 20,270 crore. 

Fundraising is a method for a company to increase its financial position. Also, it is believed that Tata Sons must avoid listing. 

If the loan amount is cut to a level of Rs 100 crore, Tata Sons may stop being considered a higher-tier NBFC by the RBI.

The regulator has requested that all of these NBFCs in the upper tier be listed on exchanges by September 2025. 

Tata Sons is against listing on the market, but RBI has denied its request to be exempt. 

Since that time, Tata has been exploring alternatives to stay clear of an IPO and the reduction of debt as one possibility according to ET previously reported.

Good Evaluation

It’s also a good opportunity for current market participants to cash out. After having risen by nearly 30 percent over the past year TCS stock hit a record-setting high on Monday.

TCS is based upon the capitalizations of all of the listed Tata Group companies and has an estimated market value of the amount of 14.5 million crore.

TCS is among those stocks where promoter ownership is greater than 72 percent. Therefore, a nominal stake of 0.6 percent will not make a huge difference, leaving Tata with a substantial amount of cash. 

Tata Sons’ stake in companies such as Tata Power (45.2 percent), Tata Motors (43.7 percent), Tata Steel (32.2 percent), Tata Consumer (29.1 percent), Trent 32.4 percent), and Titan (20.8 percent) has less than 50 percent.

About Tata Consultancy Services (TCS)

TCS is a well-known Indian multinational IT consulting and services firm headquartered in Mumbai. With a presence in 150 cities in 45 countries, TCS has been a trusted partner for global companies for over 50 years. 

Tata Consultancy Services Limited (TCS) is a subordinate business that is part of Tata Sons Pvt Ltd. The company was established with the date of 1968. 

TCS is listed as the best IT services firm in research conducted by Brand Finance and has consistently been ranked among the top IT service companies by various analysts in the field.

With a variety of solutions and services, TCS makes use of cutting-edge technology to enable business transformation.

The company is present across Latin America, North America, Europe, Asia-Pacific, the Middle East, and Africa. 

Fundamental Analysis of Tata Consultancy Services (TCS)

Market Cap₹ 14,41,446 Cr.
Current Price₹ 3,974.95
52-wk High₹ 4,254.75
52-wk Low₹ 3,070.25
Stock P/E32.50
Book Value₹ 278
Dividend1.20 %
ROCE58.7 %
ROE46.9 %
Face Value₹ 1.00
P/B Value14.3
OPM26.3 %
EPS₹ 123
Debt₹ 7,764 Cr.
Debt to Equity0.08

Tata Consultancy Services (TCS) Share Price Target 2024 To 2030

Year1st Target2nd Target
2024₹ 3,900₹ 4,500
2025₹ 4,800₹ 5,260
2026₹ 5,800₹ 6,800
2027₹ 7,000₹ 7,900
2028₹ 8,000₹ 8,490
2029₹ 8,600₹ 9,500
2030₹ 10,000₹ 10,500
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Tata Consultancy Services (TCS) Shareholding Pattern

Promoters Holding
Dec 202272.30%
Mar 202372.30%
June 202372.30%
Sept 202372.30%
Dec 202372.41%
FII Holding
Dec 202212.94%
Mar 202312.72%
June 202312.46%
Sept 202312.47%
Dec 202312.46%
DII Holding
Dec 20229.25%
Mar 20239.58%
June 20239.80%
Sept 202310.01%
Dec 202310.03%
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Govt. Holding
Dec 20220.05%
Mar 20230.05%
June 20230.05%
Sept 20230.05%
Dec 20230.05%
Public Holding
Dec 20225.45%
Mar 20235.36%
June 20235.38%
Sept 20235.17%
Dec 20235.03%

Tata Consultancy Services (TCS) Share: Last 5 Years’ Financial Condition

To gain a better understanding of how the market is performing, let’s look at the outlook of this share in the previous years. 

However, investors should be aware of the risks and the market conditions before making any investment decision.

Last 5 Years’ Sales:

2019₹ 146,463 Cr
2020₹ 156,949 Cr
2021₹ 164,177 Cr
2022₹ 191,754 Cr
2023₹ 238,818 Cr
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Last 5 Years’ Net Profit:

2019₹ 31,562 Cr
2020₹ 32,447 Cr
2021₹ 32,562 Cr
2022₹ 38,449 Cr
2023₹ 45,033 Cr

Last 5 Years’ Debt-To-Equity Ratio:

20190
20200
20210
20220
20230

Last 10 Years’ Profit Growth:

10 Years:12%
5 Years:10%
3 Years:9%
Current Year:12%

Last 10 years’ Return on Equity (ROE):

10 Years:39%
5 Years:41%
3 Years:43%
Last Year:47%

Sales Growth Over 10 Years:

10 Years:14%
5 Years:13%
3 Years:13%
Current Year:10%

Conclusion

This article is a complete guide about Tata Consultancy Services Ltd Share.

These information and forecasts are based on our analysis, research, company fundamentals and history, experiences, and various technical analyses. 

Also, We have talked in detail about the share’s future prospects and growth potential.

Hopefully, these informations will help you in your further investment. 

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