TCS
CLSA – O-P, TP ₹3559
Beat on all fronts including revenue, EBIT margin and order bookings. Expects demand in 2HFY26 to be better than 1HFY26. Growth was broad-based, with retail and the UK remaining weak. Management shows aggression with AI-focused restructuring, acquisitive stance, and 1GW data centre plan over 5–7 years — aiding long-term earnings but impacting ROCE and FCF/PAT profile.
HSBC – Hold, TP ₹3260
Q2 beat on growth and margins; deal wins in line. Sees better 2H vs 1H. AI capacity expansion reinforces TCS’s hyperscaler relationships. Risk-reward remains balanced.
Nomura – Neutral, TP ₹3300
Modest Q2 beat; revenue strong but PAT impacted by restructuring costs. Foray into data centres boosts AI ecosystem presence. FY26 expected to outpace FY25, but margin expansion seen limited.
Jefferies – Hold, TP ₹3100
Q2 revenue and margins in line, but profit missed due to Rs.11 bn restructuring cost. Growth in key markets yet to recover; 3% QoQ headcount drop negative. Data centre foray may not materially change growth profile. EPS CAGR seen at 4% over FY26–28.
Avendus – Upgrade to Buy, TP ₹3700
Deal wins strong at $10 bn in Q2 (up 16% YoY), providing recovery visibility for 2HFY26–FY27. Management optimistic on growth aided by vendor consolidation deals. AI data centre offers potential and risk; maintains FY26–27 estimates largely unchanged.
CITI – Sell, TP ₹2800
Q2 inline on revenue; EBIT margin (ex-restructuring) at 25.2%. Headcount down 3% QoQ. International growth guidance appears challenging. 1GW data centre investment increases asset intensity. Stock down 25% CYTD; outlook remains weak.
Goldman Sachs – Buy, TP ₹3300
Q2 constant currency revenue +0.8% QoQ (-3.3% YoY), EBIT up 7% YoY. Foray into data centres (1GW capacity) and focus on acquisitions to enhance AI capabilities. Neutral read-through for rest of IT sector.
UBS – Neutral, TP ₹3435 (earlier ₹3400)
Q2 margin beat; AI investments announced. Clients remain cautious with discretionary budgets tight, though project deferrals are easing.
TATA ELXSI
Kotak Institutional Equities – Sell, TP ₹4000
In-line quarter with slightly better revenue but weaker profitability. Media & communications led growth, though weakness persists. Automotive ramp-ups support near-term. Expect moderate 2HFY26 recovery; FY26E revenue to decline 5.4% YoY.
MOSL – Sell, TP ₹4400
Soft demand; headwinds in Media & Healthcare. Management guides for double-digit growth in FY27. Valuations steep at 52x 12M FWD P/E.
Avendus – Sell, TP ₹4690
Cuts revenue est. by 2% for FY26–27. Expects FY26 growth led by non-transportation verticals, broad-based FY27 recovery. FY26 EBITDA margin seen down 77 bps to 22.7%; improvement expected in FY27.
PREMIER ENERGIES
JP Morgan – Neutral, TP ₹1019
New project proposals could lift India’s solar cell capacity beyond 100 GW by FY27, outpacing demand. Oversupply risk could hit margins despite policy support like DCR/ALMM.
LIFE INSURANCE SECTOR
Morgan Stanley – Industry Update
Individual RWRP down 6% YoY; private players grew 8%. SBI Life and HDFC Life rose 15% and 6%, while ICICI Pru fell 8%. Watching for post-GST cut recovery in sales.
Kotak Securities – Sector View
Private life APE grew 9% YoY in September. SBI Life saw a sharp pickup (19% growth), driving Q2 recovery. Axis Max Life steady at 13%.
GODREJ PROPERTIES
Morgan Stanley – Equal-weight, TP ₹2400
Expects strong Q2 presales of ₹9300 cr, recovering sharply from Q1. Positions Godrej as a sector outperformer. Valuations seen attractive.
INDIA STRATEGY
Bernstein – India: The New IPO Factory
India ranks third globally in IPO funding this year, with 160+ issues in 21 months. IPOs have outperformed Nifty in five of the last seven quarters.
BofA – Q2 Preview: Searching for Sunshine
Low expectations for Q2; Autos, Discretionary, Staples, and Financials to drag earnings. Prefers NBFCs, REITs, and Autos as rate-sensitive plays.
CITI – Q2 Preview
EBITDA growth seen at 5% ex-commodities; 13% YoY headline led by commodity gains. Financials near bottom; monitoring urban consumption recovery post-GST cuts.
MORGAN STANLEY CIO SURVEY –
2026 IT spending outlook slightly improving but still below pre-Covid levels. Budgets remain cautious; sentiment mildly positive for 2026.
CLSA ON AUTO SECTOR –
Festive demand strong; GST cuts and pent-up demand lifted PV volumes 25% and two-wheelers 21% YoY in first 16 days. CVs and tractors up 5%, three-wheelers up 7%.
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