Setting records seems to come easy to India's largest software services exporter. A month after Tata Consultancy Services made history as the first listed Indian IT firm to hit market capitalisation of over $100 billion (Rs 6.78 lakh crore), it has now become the first desi company ever to breach the Rs 7 lakh crore mark, albeit briefly.
Buoyed by an early rally in its share price - it jumped nearly 2 per cent - the market valuation of TCS jumped to Rs 7,03,309 crore in intra-day session on the BSE, when the stock hit its 52-week high price of Rs 3,674 apiece. Though the share price has since steadily come down to Rs 3,577, the important thing to note is that TCS has gained nearly 35 per cent in the year so far while the Sensex has gone up just 3 per cent.
To remind you, on April 23, TCS had similarly entered the coveted $100 billion market cap club within the first hour of trade. Its shares had jumped 4.4 per cent to hit an intra-day high of Rs 3,557 apiece on BSE but it lost the position by end of the trading day. Nonetheless, the feat gave the Tata Group flagship firm entry into the list of the world's 100 most valued organisations, ranking at 97. There are 96 firms with over $100 billion market cap, according to Bloomberg data. Reliance Industries (RIL), led by the country's richest man Mukesh Ambani, was the last Indian firm to make it past the mark way back in 2007.
In fact, according to BloombergQuint TCS stock has rallied nearly 14.5 per cent since the company touched $100 billion market value, mainly on the back of a weakening rupee, which has slid 3.2 per cent against the dollar in the last one month.
In a nutshell, here is the Mumbai-based company's milestones so far: It started trading in 2004 and its market cap reached $10 billion the following year. It took nearly five years for TCS to become a $25-billion company. In 2013, it crossed the $50 billion mark and is now the country's most valued firm. The other four companies in the Top 5 most valued companies list are Reliance Industries with a market cap of Rs 5.84 lakh crore, HDFC Bank (Rs 5.19 lakh crore), HUL (Rs 3.42 lakh crore) and ITC (Rs 3.31 lakh crore).
The big question now is whether TCS can sustain its growth momentum in the near future. It had reported a 4.4 per cent rise in its March quarter net profit at Rs 6,904 crore and a revenue growth of 8.2 per cent at Rs 32,075 crore. "With robust deal wins and green-shoots in banking, financial services and insurance (BFSI) sector, there is definite possibility of double-digit revenue growth. With growth acceleration, scale up in digital and support from currency, margins are ready for uptick as well, implying return of double-digit revenue/earnings growth after 3 years," Edelweiss Research said in an April note.
The company is now looking forward to its 23rd Annual General Meeting, to be held on June 15. Among the items on the agenda is to declare a final dividend of Rs 29 per equity share for the financial year 2017-18 and to appoint a director in place of N. Chandrasekaran, "who retires by rotation and, being eligible, offers himself for re-appointment". Chandrasekaran is the current chairman of Tata Sons.
With PTI inputs