TCS shares surge 4% amid demand revival signs

January 10, 2025 (MLN): Shares of Tata Consultancy Services (TCS), India's top software services exporter, jumped 4% in early trade on Friday.

The company signaled signs of a demand revival, setting the stock up for its best day since late November, according to Reuters.

TCS CEO K Krithivasan told reporters in a post earnings press conference on Thursday that the company was seeing more confidence in discretionary programmes as clients were taking less time to sign deals.

Krithivasan's comments overshadowed a weak performance in North American revenue for the fifth straight quarter.

TCS shares were last up 4.2% at Rs4,206.30.

It led to a 1.9% jump in IT stocks, opens new tab and was the top gainer on the blue-chip Nifty 50.

CLSA upgraded TCS to "outperform" from "hold" citing Krithivasan's comments and forecast a 14% earnings per share growth in fiscal year 2026, compared to the 8% average it expects for 2025.

In a call with analysts, Krithivasan pointed to a recovery in demand in most sectors that it serves, including banking, financial services and insurance (BFSI) and consumer which accounted for about 46% of third-quarter revenue.

The improved deal execution and demand commentary are signs that point to an upcycle, Bernstein analysts said.

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