TCS loses valuation premium to peers after 14 years on top

Slips below that of Infosys, HCLTech as profit growth slows and margins contract

- KRISHNA KANT

After being the industry bellwether for more than a decade, information-technology (IT) major Tata Consultancy Services’ (TCS’) equity valuation has slipped below that of peers such as Infosys and HCLTech.

TCS is trading at a trailing price-to-earnings (P/E) multiple of 22.5X, lower than Infosys’ 22.9X and HCLTech’s 25.5X.

This is a reversal for the country’s largest IT services exporter, which led industry valuation for nearly 14 years — between 2011 and early this year. In those years, TCS traded, on average, at a trailing P/E multiple of 25.5X, at nearly a 15 percent premium to the industry average of 22.2X.

TCS’ average valuation during 2011 and early 2025 was 18 per cent and 38 per cent higher than Infosys’ and HCLTech’s average P/E multiple in the period.