Shares of Tata Consultancy Services fell 2.54 percent to hit an intra-day low of Rs 1,840.10 as the IT major posted disappointing margin performance in the third quarter.
On Thursday post market hours, TCS reported a 90 basis points on-quarter decline in consolidated operating margin for the October-December quarter to 25.6 percent on account of cross-currency headwinds and higher human resources expenses. One basis point is one-hundredth of a percentage point.
Credit Suisse maintained a 'neutral' stance on TCS share at a price target of Rs 1,775. The global research firm called the revenue to be in-line, while margins were a miss.
Morgan Stanley maintained 'overweight' stance on the IT stock at a target price of Rs 2,260, while adding that the company is on track to achieve constant currency revenue growth of 11 percent year-on-year in FY19.
Jefferies also maintained 'buy' rating but has cut target price to Rs 2,230 from previous Rs 2,300. The brokerage said that TCS is best placed to deliver double-digit revenue growth over FY19-21E among Tier-I IT companies.
Citi reiterated 'sell' rating on the stock at a target price of Rs 1,740 as concerns remained on profitable growth for sector.
Nifty IT traded 0.87 percent lower, dragged by TCS, which quoted at Rs 1,851.40, down by 1.97 percent. Only Oracle Financial Services Software ltd was trading in the green in 10 stock sectoral gauge.
Shares of Tech Mahindra, HCL Technologies, and Wipro fell 0.22-1.04 percent.
Shares of Infosys which bucked the trend in early trade also fell 0.29 percent in late morning. The company is due to announce its Q3 results
later in the day.
The Nifty50 traded at 10,815, down by 5.75 points, or 0.05 percent at 10.40 am. The Sensex slipped by 42.55 points, or 0.12 percent, to 36,064.
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First Published: Jan 11, 2019 11:13 AM IST
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