Brokerage ICICI Securities Upgrades Tata Communications to BUY, Stock Jumps 9%, Target Price ₹1840. Potential 23% Return for Investors, Strong Digital Growth Projected.
Tata Group Stock: The Indian stock market witnessed volatility on Tuesday (March 11th), with the Sensex recovering from a fall of over 400 points to close flat. Meanwhile, shares of Tata Communications, a Tata Group company, saw a significant surge, closing nearly 9% higher at ₹1,494. A key driver behind this rally was a double upgrade from brokerage firm ICICI Securities.
Brokerage's Major Decision: BUY Rating for Tata Communications
ICICI Securities has upgraded Tata Communications to a BUY rating, raising the target price from ₹1690 to ₹1840 per share. This upgrade suggests a potential return of up to 23% for investors.
Tuesday's Trading Update:
Opening Price: ₹1361
Intraday High: ₹1500
Intraday Low: ₹1361
52-Week High: ₹2,175
52-Week Low: ₹1,293
Company's Market Cap on BSE: ₹42,579 Crore
Brokerage Opinion Behind the Share Price Surge
The brokerage firm upgraded Tata Communications (TCom) from a Hold to a BUY rating. While the stock previously declined due to weak revenue growth, the firm now sees b upside potential.
Key Points from the Brokerage Report:
The company faced challenges from a cable cut in the Red Sea and a weak order book, but these issues are now resolved.
The order book growth for FY25 has reached double digits, strengthening data revenue growth.
Tata Communications' digital product portfolio is strengthening, though the market hasn't fully recognized this yet.
Free cash flow is projected to reach ₹3,300 crore by FY27.
The company has launched several new products to strengthen its cloud ecosystem, boosting future growth prospects.
