TCS
NSE: TCS•Information Technology
Current Price
₹3,980
TECH-FUNDA™
Strong
Global technology consulting titan with industry-leading operating profit margins, zero debt, and massive shareholder dividend distribution.
Price to Earnings (P/E)
29.2
Trailing Twelve Months
Return on Equity (ROE)
51.4%
Shareholder Capital Return
Price to Book (P/B)
14.8x P/B
Asset Backing
Enterprise Multiple
20.4x
EV / EBITDA
Fundamental Quality Core
3-Stage DuPont ROE Decomposition
ROE = Net Margin × Asset Turnover × Equity Multiplier
1. Operating Margin
19.3%
Operating efficiency and pricing power translation to net earnings.
2. Asset Turnover
1.82x
Capital velocity; revenue generated per rupee of assets deployed.
3. Financial Leverage
1.46x
Total assets divided by net worth; leverage multiplier to equity.
DuPont Assessment: Exceptional ROE driven by world-class operating margins and rapid asset turnover, not financial debt.
01 · BUSINESS
Business Quality & Moat
Competitive Moat: Sticky mission-critical IT relationships with Fortune 500 enterprises with over 95% repeat business.
Pricing Power: Premium billing rates in cloud migration, cyber security, and enterprise AI transformation.
Growth Catalysts: Multi-year deal wins in enterprise AI modernization and cloud infrastructure migration.
02 · FUNDAMENTALS
Financial & Balance Sheet
Balance Sheet Health: Virtually zero debt with substantial net cash and liquid treasury investments.
Cash Flow Dynamics: Free cash flow conversion consistently exceeds 100% of reported net income.
Capital Discipline: Lean debtor days and negative net working capital requirements.
03 · VALUE
Valuation Intelligence
Price Multiple Context: Trading at 29.2 P/E and 14.8x P/B.
Historical Benchmark: Valued at a modest premium due to unrivaled execution and high dividend payout ratios.
04 · RISK
Risk & Downside Watch
Corporate Governance: Tata Group pedigree; world-class institutional corporate governance track record.
Execution Headwinds: Managing talent attrition and shifting wage inflation in international delivery centres.
Economic Sensitivity: Discretionary IT budget slowdowns across US and European BFSI verticals.
TECH-FUNDA™ RESEARCH PIPELINE
Market Filter→Business Moat→DuPont ROE→Valuation Margin→Active Thesis