Shares of Tata Consultancy Services (TCS) declined nearly 2% in early trade on Thursday as investors remained cautious ahead of the company’s fiscal first quarter earnings announcement.
Market participants are looking beyond the headline financial numbers and are closely tracking management commentary on technology demand, artificial intelligence (AI) adoption and recovery in discretionary spending.
TCS shares fell as much as 1.9% to Rs 2,018.5 during morning trade. The decline extended the stock’s weakness in 2026, with the IT major losing around 36.2% so far this year, compared with an 8.7% fall in the benchmark Nifty 50.
The company’s market capitalisation stood at nearly Rs 7.45 lakh crore.
The decline came despite positive movement in the broader market. At around 9:18 am, the Sensex was trading nearly 349 points higher at 76,852, while the Nifty gained around 115 points to touch 23,997.
Market breadth remained positive, with more stocks advancing than declining. However, the Nifty IT index moved lower by 1.54%, with major technology companies including TCS, Infosys, HCLTech and Tech Mahindra witnessing selling pressure.
TCS is scheduled to announce its Q1 FY27 results later on Thursday, marking the beginning of the quarterly earnings season for India’s IT services sector.
Apart from revenue and profit figures, investors are expected to focus on the company’s deal pipeline, client spending trends, AI-led opportunities and the outlook for discretionary technology budgets.
Analysts estimate TCS could report quarterly deal wins between $7 billion and $10 billion, lower than the previous quarter’s $12 billion.
The company’s AI strategy will also remain a key area of interest. TCS has been expanding its AI capabilities through platforms such as HyperVault and has announced plans to invest around $2 billion in AI data centre infrastructure along with TPG.
It has also partnered with OpenAI for developing a 100 MW AI data centre with potential expansion.
At its annual general meeting in June, Chairman N Chandrasekaran highlighted AI as a major growth opportunity, stating that AI-related revenue had grown consistently and reached an annualised run rate of nearly $2.5 billion.
Investors will also monitor updates on the second phase of the BSNL project, GenAI opportunities, HyperVault progress and the impact of global geopolitical uncertainty on technology spending.
Recent comments from global IT firms about delayed discretionary spending have added concerns that Indian software exporters may see a slower recovery in demand.
