India’s Tata Consultancy Services (TCS), the outsourcing giant, crossed the Rs 5 lakh crore mark in market capitalization on July 24, to become India’s most and the world’s second most valuable IT services company.
TCS’s market valuation jumped to Rs 5,03,148 crore, about 84 billion USD, the highest since its listing l0 years ago.
Ireland-based Accenture’s was third with market valuation at $51 billion, while the US’ IBM is a clear first with $193.7 billion.
TCS is also way ahead of its other Indian competitors. TCS’s record market cap is bigger than the combined market cap of the other four domestic IT players in India. It leads Infosys ($31.7 billion), Wipro ($23.3 billion), HCL Technologies ($17.9 billion) and Tech Mahindra ($8.5 billion).
This news has also boosted the share prices of TCS by nearly 9%. Last week the company announced $845 million of net profits on $3.69 billion of revenue for FY2015.
Analysts suggest that TCS financial performance has propelled its market valuation. In the first quarter of FY15 the company managed to bag seven large deals.
TCS is known for consistently posting results that surpasses market expectations. While the company does not provide a quarterly or annual guidance, it exceeded software lobby group Nasscom’s 12-14% revenue forecast for fiscal 2014 and is expected to beat their revenue forecast of 13-15% revenue for fiscal 2015.
The record market cap also cements India’s reputation as an IT giant. The IT sector has played a key role in India’s growth, and is considered the engine of India’s rise as an economic powerhouse. According to Nasscom, India’s IT industry was expected to bring in export revenues of $84-87 billion in FY14. In FY 2013 the export revenue clocked $76 billion.
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