“Cloud adoption will continue to remain a strong demand driver and can be characterized as the new ERP. The increased volume of M&A, divestiture and carve-outs are driving demand in end-to-end technology integration,” analysts at Prabhudas Lilladher said in Q3FY21 result update.
Analysts at Motilal Oswal Securities believe IT Services has entered into a technology upcycle, led by cloud- and data-driven deals coming onto the market. Given TCS’ size, capabilities, and portfolio stretch, it is rightly positioned to leverage expected industry growth.
Additionally, TCS has consistently maintained its market leadership and shown best-in-class execution. This gives the company continued room to increase its margins, along with demonstrating industry-leading return ratios. While we remain positive on the company, we are 'neutral' on the stock given the rich multiples, the brokerage firm said in result update.