Home / Business and Economy / TCS Overtakes Accenture in Market Cap Amidst Tech Downturn
TCS Overtakes Accenture in Market Cap Amidst Tech Downturn
20 Jun
Summary
- TCS surpassed Accenture in market capitalization for the first time since February 2021.
- Accenture's weaker-than-expected guidance triggered concerns about global tech spending.
- Indian IT firms face a weak near-term outlook due to reduced outsourcing and cautious spending.
Tata Consultancy Services (TCS) has achieved a significant milestone, surpassing U.S. rival Accenture in market capitalization for the first time since February 2021. As of Thursday's close, TCS commanded a valuation of $84.6 billion, exceeding Accenture's $77.6 billion.
This development follows Accenture's release of weaker-than-expected revenue guidance and a lowered full-year growth forecast. The IT giant also reported a 2% decline in new bookings for the quarter ended May 31, indicating ongoing caution in client technology spending, particularly for discretionary projects.
Accenture's stock has lost over 50% of its value this year, while TCS has seen a nearly 30% decline. The performance of Accenture, which has a substantial offshore delivery model with approximately 325,000 employees in India, is closely watched by Indian IT firms.
Analysts, including Motilal Oswal, maintain a negative near-term outlook for Indian IT stocks. They cite reduced outsourcing deals, geopolitical tensions, and cautious client spending as key challenges, noting that AI's revenue contribution is not yet sufficient to offset the slowdown in traditional IT services.
