TCS Share Price Falls 2% After Q1 Results - Buy or Wait?

Tata Consultancy Services (TCS) released its Q1 2025-26 results on July 10, 2025. TCS is India's biggest IT company, so when it announces results, everyone in the stock market pays attention. The results were mixed - profits grew but revenue growth was slow, which made some investors worried.

Key Numbers from TCS Q1 Results 2025

Quarter-over-Quarter Comparison (Q1 2025-26 vs Q4 2024-25)

What This Means in Simple Terms

TCS generated ₹63,437 crore in Q1 2025-26, which is ₹1.3 more for every ₹100 of revenue earned than the same quarter a year ago.  However, revenue for Q1 2025-26 was actually lower than before, as it decreased by 1.6% for Q4 2024-25. The good news is that TCS profit was better as well, where TCS profit of it was up 4.4% quarter-over-quarter, signalling better cost management and higher profit margins.

TCS Share Price Today: What Happened After Results

After the announcement of Q1 results, shares of TCS fell almost 2.5% in one day. The stock has been trading between ₹3,360 and ₹3,580 for the last 11-week period. Currently, it is on the lower end of that range, which is making some investors jittery.

Key Price Levels:

• 52-Week High: ₹4,585.90 (September 2024) 

• 52-Week Low: ₹3,060.25 (April 2025) 

• Current Range: ₹3,360 to ₹3,580 

• Recent Close: ₹3,382.30 (down 0.06%)

TCS Share Price Target 2025

Despite the mixed Q1 results, most stock market experts remain positive about TCS. They believe the current share price offers good value for money.

Brokerage Targets:

• Motilal Oswal: ₹3,850 target (14% upside potential) - BUY rating  • JM Financial: ₹3,950 target - BUY rating
• SMC Global: Positive outlook citing resilience amid challenges • Geojit Investments: Constructive view on long-term prospects

Looking at the bigger picture, experts predict TCS share price could reach ₹4,450 to ₹4,550 by early 2025, and potentially ₹4,560 to ₹4,650 by the end of 2025. However, these are predictions and actual prices may vary based on market conditions and company performance.

TCS ADR Price: For International Investors

TCS also trades on US markets through American Depositary Receipts (ADRs). The ADR price typically follows the Indian stock price but can have slight variations due to currency exchange rates and market timing differences.

TCS Q1 Results: The Good and The Challenging

Good News from TCS Q1 Results

TCS reported TCS made some positive announcements in Q1 2025-26. TCS announced a dividend of ₹11 per share which means that shareholders will receive cash directly in their bank account. TCS hired 6,071 employees during the quarter indicating confidence in future growth. TCS focus on Artificial Intelligence (AI) seems to be paying off with more than 114,000 employees now possessed advanced AI skills. Additionally, employee satisfaction appeared to improve as evidenced by the attrition rate going down to 13.8 percent from 17.9 percent last year.

Challenges TCS Faced

However, TCS did encounter some challenges. For instance, TCS had very slow revenue growth of just 1.3 percent over last year and disappointed many investors who opting for faster growth. Similarly, certain business segment struggled, including Life Sciences which decline of 9.6 percent and the India business which fell by an alarming 21.7 percent. Moreover, TCS made the decision to not award any salary increases to employees through the quarterly performance review, which may be a factor in the employee morale. Last but not least, revenue actually fell by 1.6 percent from the prior quarter, indicating some weakness in demand.

Impact on Stock Market after TCS Q1 Result

TCS Q1 result dented the Indian stock market. When TCS announced its results, the BSE Sensex and NSE Nifty opened down the next day. TCS was down 1.78% in morning trading in India and that negative sentiment extended to other IT companies as well. Infosys was down by 1.83% in that same morning trading, and other IT stocks including Wipro, Tech Mahindra, and HCL Technologies dropped too. The whole QT of TCS influence is reflective of how TCS influences market sentiment as India's largest IT company. When there are mixed results, investors grow nervous about the entire IT sector because if TCS has problems, there are likely other IT companies that will have similar issues.

Should You Invest in TCS? Simple Analysis

Why TCS Remains Attractive

TCS remains a very strong company with some challenges. It has a healthy net margin of 20.1%, meaning it retains ₹20 for every ₹100 earned. This is quite good for the industry. TCS also provides regular dividend income for its shareholders. As the largest IT company in India, TCS is well-positioned in the market with long standing relationships with global clients. Its heavy investment in AI and digital will allow TCS to continue growing for years to come. 

Things to Watch Out For

Investors may want to be prudent in the following areas. TCS's revenue growth of only 1.3% fell below what many investors expected. Global uncertainty is causing a drop in demand for IT services which will affect TCS's growth. Competition in the IT sector is increasing, as many companies are competing for the same clients. Some of TCS's business segments are struggling, especially in Life Sciences and domestically in India.

TCS Result: What Different Investors Should Know

For New Investors

If you are contemplating a first-time purchase in TCS, the price levels might be attractive with the stock coming off of its highs. It should be cheaper now. TCS is a sound company, has a long-standing history of being a profitable dividend paying company, but new investors should be prepared for sluggish growth in the near term and should be investing with a long-term outlook. 

For Current Shareholders

If you own TCS, there is good news and bad news. The good news is that you will receive ₹11 per share in dividend to provide you with immediate benefit. The bad news is the slow revenue and market growth indicates price appreciation could take ages, but on the positive side, strong fundamentals and market leadership means you can hold on to it for the long-term.

For Active Traders

If you are a trader and are looking to buy and sell shares frequently, TCS is currently going through a trading range at ₹3,360 to ₹3,580. If you are able to catch a move anytime within the range, that's even if you are near the top or bottom of this range you can try buying shares when TCS is near ₹3,360 and sell when it's near ₹3,580, if it breaks below ₹3,360, it could fall to ₹3,250 at that level, or if it breaks above ₹3,580 it could move significantly higher.

Key Points to Remember

• Mixed Results: TCS Q1 results showed profit growth but slow revenue growth  • Dividend Reward: ₹11 per share dividend announced for shareholders
• Market Leader: TCS remains India's largest IT company with strong fundamentals • Future Investment: Heavy focus on AI and digital technologies for future growth  • Stock Price: Trading in range of ₹3,360-₹3,580 with expert targets of ₹3,850-₹3,950

What's Next for TCS?

TCS management remains optimistic about future growth despite the current challenges it faces. The company is spending significantly on artificial intelligence and digital transformation services, and plans for more spending on innovation across sectors and industries in the future. Moving forward, these should be positioning the company to harness more future revenue. Many global businesses are leveraging AI and cloud technologies more than they previously did, and TCS' expertise lies in these areas. The continuation of global economic uncertainties and geopolitical tensions will likely impact short-term performance, and TCS ability to work through these issues while preserving market leadership will likely be one of their top priorities. As such, TCS management will need to demonstrate their ability to continue using innovation to maintain favourable financial metrics. Fortunately, TCS has access to a good balance sheet, and since they have also hired very skilled people, in addition to having long-term relationships with their various clients, these could suggest some stability while working through uncertain times. 

For investors, TCS shares are probably a wiser option for those who've bought into India's IT sector growth story, and the company's valuation seems reasonable, but it also depends on your preferred time horizon as a long-term investor. However, if you prefer a shorter time horizon, with the chance of a quick return, you may want to hold off until the company arrives at some conclusions with their current issues in the market before jumping into TCS' stock.

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Disclaimer : This article is for educational purposes only and should not be considered as investment advice. Always consult with a financial advisor before making investment decisions.

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