A

SUMMER INTERNSHIP PROJECT REPORT

ON
“Fundamental and Technical Analysis on
Indian Information and technology sector”

SUBMITTED TO
Master of Business administration-MMS
(2019-2020)

Submitted by
Tejas Shriram Meena
2019-21
Table of Content
Sr. No. Topics Page No.
1 Executive summary 8
2 Introduction 9-10
2.1- Overview of Indian Information and Technology
Sector
3 Growing market size of Indian IT market 10
4 IT Sector Advantage To Indian Economy 11
5 Growth Drivers of Indian IT Sector 11
6 Current Scenario of Indian IT sector 12-13
6.1 - overview of IT sector revenue FY2019-FY2020
6.2 - Indian IT sector Export Growth
6.3 - Revenue of India’s Major IT Firms From BFSI
7 COVID - 19 Impact on IT Sector in India 14
8 Company Overview
8.1 Tata Consultancy Services (TCS) 15
8.2 Infosys 16
8.3 Wipro 17
9 Objective And Scope of Study 18
10 Research Methodology 18
11 Review of Literature 19
12 Data Collection and Data Analysis
12.1 Fundamental Analysis 20-34
12.2 Technical Analysis 35-38
13 Key Findings 39
14 Conclusion & Recommendations 39
15 References 40
1. Executive Summary

The project report “Fundamental and Technical Analyse on India Information and Technology
Sector” is a study to analyse the strength and weakness of information technology sector and
three major companies. The companies include Tata Consultancy Services, Infosys and Wipro.

The primary objective of the study is to suggest the investors, whether to by the stocks of these
companies or not, based on the fundamental analysis including valuation (undervalued or
overvalued) the share prices are of the company. Also to analyse the stock price trend in the
market ( bullish or bearish ). The secondary objective of the study is to analyse the company’s
performance and to understand the functions of the company in capital market and to compare
do a peer comparison amongst the selected companies.

To analyse the companies , fundamental and technical analysis are used. In the fundamental
analysis the method of intrinsic value of calculation is used. For the technical analysis , tools
used like relative strength index (RSI) and Price trend analysis In fundamental analysis
valuation is done to compare the intrinsic value to the current market value to suggest the
investor to buy or sell the shares of the companies and technical analysis used to analysis the
movement of the shares with corresponding graphs and candlestick charts and interpret whether
to buy or hold the share for better profitability in short and long run. The analysis of sectors is
down systematically by focusing on sector growth , current scenario, country’s current
economy conditions first and then focusing and analysing the three selected companies in the
sector.
2. Introduction
2.1 Overview of Indian Information and Technology Sector
Indian Information and technology industry, is among the fastest growing sectors globally as
well as in India. Market size of IT sector has witnessed a growth of 6.1 percent and it is
estimated that the size of IT sector will Grow to $350 billion by year 2025. It sectors employs
4.36 million employees directly and indirectly and has generated 2 million+ tech jobs since
2010. Indian It sector can broadly classified into It services, business process management,
Engineering R& D, software products and e-commerce.
The IT services market size was at $93 billion in 2019 with over 81 percent of revenue
generated from export market. IT Services accounted for 51 percent of total share of Indian IT
sector revenue in the year 2019, BPM had 20 per cent of IT sector revenue with market size of
$36.2 billion and growing at over 8 percent, Convergence of digital technologies across all
services lines gained prominence such as AI ,analytics and automation, created new revenue
Strems and business models. ER&D has contributed over 19 per cent revenue share in the
Indian IT space having a market size of $ 34.39 billion in 2019 and experiencing fastest growth
segment at 11 percent by increased focus on digital engineering for better UX and
personalization of platform and cloud and building full stack capabilities. Software Products
and Start-ups growing at over 9.5 percent in 2020 driven by the product development around
AI, RPA, cloud and analytics, growth in ERM,CRM and collaborative application with strong
and improved performance of B2B product base start-ups. eCommerce growing at 25 per cent
in 2020 driven by increasing penetration of m-commerce ,growing demand for niche products
and easy and secure digital payment channels.

India IT sector Revenue breakup is shown in the figure below :

10

19

51

20

IT services BPM ER&D Hardware

IT sector Revenue breakup

IT services – 51%
Business process management – 20%
Engineering R& D – 19%
Hardware – 10%
The sector has a huge impact on the economy of India as it is one of the top sectors which
generate jobs and from time to time innovates solutions to problems. IT sector in India has high
 cost efficiency in terms of skilled professional’s as in comparison with the developed country.
The rapid emergence of Indian IT sector has transformed Indian economy, In India currently
IT sector account for 8 % of share in India’s GDP and has added $105 billion in revenue and
over 2 million employees.
IT sector in India is also fuelling the growth of start-ups in India with presence of around 9000+
tech start-ups in India. The sector has also been strengthening the foundation of India as an
innovation hub where in India today have 24 unicorns with 50 soon to be unicorns and start-
ups are growing at 12-15 percent y-o-y. This sector is one of the highest impact creators for the
country – economic, innovation, job creation and inclusivity.

3 Growing market size of Indian IT market.

The IT sector revenue was $177 billion in FY 2019, $136 billion was from export and $41
billion from domestic revenue. IT-BPM sector was estimated at $191 in FY2020 at 7.7 percent
growth y-o-y. The domestic revenue of the sector was estimated at $44 billion and export
revenue was estimated at $147billion in FY2020
The market size of Indian IT sector is estimated to grow to $350 billion by FY2025 and BPM
is expected to account for $50-55 billion out of the total revenue.
Outsourcings of large technology contract by clients accelerated the growth of the sector in
2020.
The cloud market of India is expected to grow three-fold to $7.1 billion by 2022 as India
actively adopting and using help of Big Data, analytics , artificial intelligence and Internet of
Things (IoT) says the could next wave of growth in India report
India’s digital economy is estimated to reach $1 trillion by 2025
The Indian IT sector has over 17000 firms operating out of which more then 1000 are the large
firms with 50 locations in India. India is being ahead of other countries when it comes to cost
competitiveness in proving IT services, which is nearly 3-4 times more cost effective the
developed country like US.

The overall growth of IT sector over last five years shown in below figure:

160 147
136
140 126
117
120 108
100

80

60
41 41 44
35 37
40

20

0
FY16 FY17 FY18 FY19 FY20

Domestic Export

\
4 IT Sector Advantage to Indian Economy
• India is the largest and fastest growing Information Technology and IT enabled services
sourcing destination across the world. Showing strong growth in demand for export.
Rapid growth in urban infrastructure has encouraged several IT centres in the country
• India has a low cost advantage by being 5-6 times in expensive the US, and continues to
be leader in the global sourcing industry with 55 percent market share
• Indians top IT firms have delivery centres across the world and have diversified verticals
like BFSI, telecom and retail, India has its global preference by increasing its strategic
alliance between domestic and international players, across the globe
• Indian government Is actively supports the IT sector through their policy’s , Tax
exemption of three years to seven years start-ups under ‘start-ups India’, government
have more liberal policy system for raising global capita, funding and growth and ease of
doing business.
• The government has announced plans to lunch national programme on Artificial
intelligence and setting up national AI portals

5 Growth Drivers of India IT sector

• Highly Qualified talent pool : Availability of highly qualified talent pool at lower rates
helps in cutting the cost for about 60-70 % to source countries. NASSCOM has also
launched online platforms to skill up over 2 million technology profession and another 2
million potential employees and students.
• Increase adoption of emerging technology : Disruptive technologies such as cloud
computing, social media and data analytics are offering new avenues of growth across
verticals for IT companies, The SMAC (social, mobility, analytics, cloud) market is
expected to reach US$ 225 billion by 2020.
• Growth in non-linear models : India IT sector is moving from linear model (rising
number of employees to increase revenue) to non linear model, in view of this IT
companies in India are now focusing more on new models such as platform based BPM
services and creation of intellectual property
• Government support : Government of India has identified Information Technology as
one of the 12 champion service sectors for which an action plan is being developed. Also,
the Government has set up a Rs 5,000 crore fund for realising the potential of these
champion service sectors, also government has announced policy’s for tax holidays for
STPI and SEZs
• Developed infrastructure : India is moving to advance and robust IT infrastructures
across various cities in the country such as Bengaluru ,
• Global demand for IT services : globally IT services and BPM spending’s is estimated
to rise and reach to $233 billion by 2025
• Increase digital segment opportunity: Indian IT sector is focusing on digital opportunity
as digital poised to be major segment in next few years. Currently it is the fastest growing
segment over growth rate of 30 percent annually. India has become the digital capabilities
hub in the world : Second fastest digital economy amongst 17 leading economies in the
worlds, more than 8100 firs offers digital solution’s, digitally skilled talent pool of
450000-500000 , 75 percent of global digital telnet in India.
6 Current scenario of Indian IT sector:
6.1 Overview of Indian IT sector revenue FY2019-2020

• Total Revenue in FY2019 stood at $191 billion, with a growth Rate of 7.7 per cent
• Digital revenue also increased in FY2019 and contributed around 26-28 percent
• IT services reached $100 billion mark, with growth rate of 6.7 percent , by major revenue contribution
from exports in IT services accounting 54 percent of total IT export in FY2019
• BMP is growing at 8 percent, ER&D is been fastest growth segment at rate of 11 percent. exports from
BMP and ER&D was accounted 23 percent of total IT exports during FY2019

6.2 Indian IT sector Export growth

• Revenue of India IT sector has a major contribution from export revenue, the export sector has crossed
$147 billion in revenue for FY2020 at growing rate of 8.1 percent
• The export revenue has been seen a growth at a CAGR of 8.05 percent during the FY2016 – FY2019.
• Major revenue contribution in IT exports was contributed by IT services with 54 percent and followed
by BPM at 23 and ER&D and software products at 23 percent.
• In FY2019, export from and It enabled services registered a growth of 17 percent to reach Rs 1.09 lakh
cores ($15.63 US billion).

Sector-wise breakup of export revenue (FY19)

IT Service
23%

BPM
54%
23% ER&D and
Software
products
 • ER&D and software products export market is expected to grow from US $28 billion to US $42 billion
by the year 2022

Geographic breakup of export revenue in FY2019

• US has been the biggest importer of India’s IT

8 2 exports since many years, In FY2019 US has
accounted over 62 percent of Indian IT-BPM
11
export.
• Other countries except US & UK has been
accounted for just 21 percent of total Indian IT-
17 BPM export during FY2019
62
• In FY2019 US and UK were the leading
customers market with an combined share of
nearly 80 percent, there also has seen
US UK Europe (ec-UK) Aisa ROW increased demand from middle east Asia
regions.
• India sees opportunity to attract more markets in other regions, in same way it tapped the US and UK
market ,by being the low cost exporter of IT services in the world.

6.3 Revenue share of India’s major IT firms from BFSI ( Banking, financial
services and insurance)
• BFSI remains to be key business vertical in IT-BMP
sector, as major share of revenue of IT major firms
comes from the BFSI business vertical.
• BFSI vertical growth is excepted to be accelerated
by adoption of new technologies.
• Infosys solely acquired 72 percent stake in ABN
AMRO banks subsidiary for US $143.08 million , in
May 2019. In June 2019 Mindtree was acquired
by L&T.
• TCS signed a contract worth Rs.10650 cores from
pharma company, Walgreen’s boots alliance
• Wipro Infosys and TCS accounted almost 30
percent of revenue share from BFSI in Q3(2020).
7 COVID – 19 Impact on IT sector in India
Currently the world and Indian economy had been hit hard with COVID-19 pandemic, where the IT sector and
the top companies forecasted the growth rate of 7.7 % in the fiscal year 2020 but now having a though time.
And the sector is expected to post either a flat or a negative growth in third and fourth quarter of 2020 due to
the impact of coronavirus pandemic globally.
Economic actively is been worse than what have seen in 2008 (global financial crisis), predominantly export
sector have been effected badly as major IT companies are working from home due to this pandemic data
security and privacy has come into focus, along with challenges of individual accountability and ownership.
With increase number of job cuts and lay offs or pay freeze taking the IT sector operational actively at lowest,
the sectors is forced to cut operational flab, sharpen operational efficiency and revive its delivery model.

IT spending forecast has indicated continued demand for cloud infrastructure services and potential
increase in spending on specialized software. There has also seen an increase demand for
communication equipment and telecom services as due to COVID – 19 pandemic the organisation’s
encourage employees to work from home and school moves to online courses.
The IT sectors largest client segment of banking, financial services and insurance which almost
accounted 30 percent of industry revenue will deliver an 8 percent top line growth on rising share of
digital transaction, also other segments on IT sector will also expected to grow at similar growth rate
in this pandemic, the slowdown in the economies has effected the revenues of IT sector and having an
impact on profitability of the IT firms.
8 Company Overview
8.1 Tata Consultancy Services (TCS)

Tata Consultancy Services is an IT services, consulting and business solutions organization that has
been partnering with many of the world's largest businesses in their transformation journeys for over
50 years. TCS offers a consulting-led, cognitive powered, integrated portfolio of business, technology
and engineering services and solutions. This is delivered through its unique Location TM Independent
Agile delivery model, recognized as a benchmark of excellence in software development. A part of the
Tata group, India's largest multinational business group, TCS has over 448,000 of the world's best-
trained consultants in 46 countries. The company generated consolidated revenues of US $22 billion
in the fiscal year ended March 31, 2020, and is listed on the BSE (formerly Bombay Stock Exchange)
and the NSE (National Stock Exchange) in India.
TCS is one of the topmost recruiters in India in the field of information technology, therefore, it is
imperative for the aspirants to know some basic yet important information about the company before
going in for the interview. This blog states some basic information regarding TCS such as its history,
organization heads, the tagline of the company, products, and services offered etc., which should be
kept in mind by the candidates before going in for the interview. Freshers are generally offered the
role of 'Software Engineer Trainee' at TCS.
TCS provides a wide range of information technology-related products and services including
application development, business process outsourcing, capacity planning, consulting, enterprise
software, hardware sizing, payment processing, software management, and technology education
services. The firm's established software products are TCS BaNCS and TCS MasterCraft.

Tata Consultancy Services

(TCS) achieved annual sales
of about 1.57 trillion Indian
rupees in its 2020 fiscal year,
which is the equivalent of
around 21 billion U.S. dollars.
Tata Consultancy Services
Limited revenues increased
7% to RS1.569T. Net income
increased 3% to RS323.4B.
Revenues reflect Others
segment increase of 14% to
RS271.28B, Banking,
Financial Services &
Insurance segment increase of
5% to RS610.95B,
Communication media and Technology segment increase of 9% to RS259.78B, Europe. segment
increase from RS205.94B to RS480.37B. Tata Consultancy Services is the largest company by having
a market capitalisation of Rs 797,250.42 cores (7.97T), Infosys is TCS’ biggest competitor in India.
As the second largest Indian software company by market capitalization
8.2 Infosys

Infosys is a global leader in next-generation digital services and consulting. It has enable clients in 46
countries to navigate their digital transformation. With nearly four decades of experience in managing
the systems and workings of global enterprises, Infosys expertly steer in their clients through their
digital journey. Infosys do it by enabling the enterprise with an AI-powered core that helps prioritize
the execution of change. We also empower the business with agile digital at scale to deliver
unprecedented levels of performance and customer delight. Our always-on learning agenda drives their
continuous improvement through building and transferring digital skills, expertise, and ideas from our
innovation ecosystem. Infosys helps businesses to renew & improve existing conditions so that their
business can achieve higher efficiencies and stay relevant according to current times.
Infosys has more than 243,454 employees and through their hard work & dedication, out of which
37.8% were women. Out of its total workforce, 229,658 are software professionals and remaining
13,796 work for support and sales. The Company, along with its subsidiaries, provides business
information technology services comprising application development and maintenance, independent
validation, infrastructure management, engineering services comprising product engineering and life
cycle solutions and business process management; consulting and systems integration services
comprising consulting, enterprise solutions, systems integration and advanced technologies; products,
business platforms and solutions to accelerate intellectual property-led innovation, including Finacle,
its banking solution, and offerings
in the areas of Analytics, Cloud and
Digital Transformation. Its
segments are Financial Services
and Insurance (FSI), Manufacturing
and Hi-tech (MFG & Hi-Tech),
Energy & utilities, Communication
and Services (ECS), Retail,
Consumer packaged goods and
Logistics (RCL), and Life Sciences
and Healthcare (LSH). Infosys
Limited, formerly known as Infosys
Technologies Limited, is
headquartered in Bengaluru, India.

In FY2020 Infosys has been awarded 3rd Best regarded company in the world in Forbes annual list of
top 250 companies in the world. For the fiscal year ended 31 March 2020, Infosys Ltd revenues
increased 10% to RS907.91B. Net income increased 8% to RS165.94B. Revenues reflect Financial
Services and Insurance(FS) segment increase of 8% to RS286.25B, Communication segment increase
of 15% to RS119.84B, Energy and utilities, Communication and Services(ECS) segment increase of
13% to RS117.36B
8.3 Wipro

Wipro Ltd. is a global information technology, consulting and outsourcing company, which engages
in the development and integration of solutions. It operates through the Information Technology
Services and Information Technology Products segments. The Information Technology Services
segment provides IT and IT-enabled services which include IT consulting, custom application design,
development, re-engineering and maintenance, systems integration, package implementation, global
infrastructure services, BPO services, cloud, mobility and analytics services, research and development
and hardware and software design. The Information Technology Products segment provides a range
of third-party IT products, which allows to provide comprehensive IT system integration services. The
company was founded on December 29, 1945 and is headquartered in Bangalore, India. In FY2020
Wipro has total 180,000 dedicated employees serving clients across six continents, 35% of the
workforce is women. Wipro is a global technology services firm, with employees across over 55
countries and serving enterprise clients across various industries.
IT Services segment provides a range of IT and IT-enabled services which include digital strategy
advisory, customer centric design, technology consulting, IT consulting, custom application design,
development, re-engineering and maintenance, systems integration, package implementation, global
infrastructure services, analytics services, business process services, research and development and
hardware and software design to leading enterprises worldwide.
IT Products segment provides a range of third-party IT products, which allows us to offer
comprehensive IT system integration services. These products include computing, platforms and
storage, networking solutions, enterprise information security and software products, including
databases and operating systems. We provide IT products as a complement to our IT services offerings
rather than sell standalone IT products.
In FY2020, Wipro IT
Services Revenues at
$8.26 billion grew by
3.9% YoY and Net
Income at `97.2 billion
grew by 8.0% YoY ,In
FY2020 Wipro Limited
revenues increased 4% to
RS610.23B. Net income
increased 8% to
RS97.22B. Revenues
reflect IT Services
segment increase of 5% to
RS594.04B, Americas
segment increase of 8% to RS352.32B. Net income benefited from IT Services segment income
increase of 4% to RS106.54B, IT Products segment loss decrease of 73% to RS282M, ISRE segment
loss increase of less than 1% to RS1.82B, Wipro has a market capitalisation of 128,746.31 cores
(1.28T)
9 Objective of the study
Primary objective

To carry out the sector analysis and fundamental and technical analysis of three selected
companies in the IT sector ( tata consultancy company, Infosys and Wipro) to know about the
current scenario of the sector and the companies function through which it will help to suggest
the investor to invest in these company and have a wider look at the sector, And to analysis the
current scenario of Indian Information and technology sector , to identify the growth drivers of
Indian IT sector and contribution in the Indian economy.

Secondary Objective

The secondary objective of the study is as follow

• To analyse and compare all three companies performance
• Understanding stock market and all three companies functions in stock market
• To analyse companies fundamentals through different financial tools
• To perform different types of valuation methods to come up target price of all three
companies.
• To perform Altman Z-Score analysis to identify the financial strength of the companies
• To offer suggestions based on the analysis of the study.

Scope of the study

• The study is totally dependent on the data collected from the secondary sources. The study is totally
dependent on the accuracy of the data collected from the secondary sources, the study will give the
investors in detail analysis of the stock
• The study is conducted based on the selected IT companies listed in NSE. The companies are
selected with respect to their market capitalization, revenue, sales and performance.

10 Research Methodology
Secondary research
• The study of Indian information and technology sector is done to identify the growth of IT sector in
Indian economy and carry out three major companies analysis in this sector.
• In this report mainly secondary data is used. Data are collected from sources such as internet,
• websites ‘of selected companies, company balance sheets, annual reports, press release etc.
Analysis of data is done with help of Fundamental tools for selected Three companies
• The Data was strictly collected from companies websites and other authentic websites
• Two analysis mainly is fundamental and technical analysis, In fundamental analysis tools different
tools are used to perform valuation, profitably and solvency of the companies and Technical analysis
tools use are price chart trend analysis and Relative strength index.
11 Review of Literature

• Literature review is a study involving a collection of literatures in the selected area of research in
which the researcher has limited experience, and critical examination and comparison of them to
have a better understanding. It also helps the researchers to update the past data, data sources and
results and identify the gaps, if any in the researches.
• India Brand Equity Foundation (IBEF) Research paper on Indian Information and technology industry
2020, India Brand Equity Foundation (IBEF) engaged TechSci Research to prepare this presentation
and the same has been prepared by TechSci Research in consultation with IBEF.
• A systematic review of fundamental and technical analysis of stock market predictions Isaac Kofi Nit
(2019)
• A Study on the Indian Information Sector: An Experiment with Input-Output Techniques Sikhanwita
Roy,Tuhin Das & Debesh Chakraborty 2010
• Fundamental Analysis as a Method of Share Valuation in Comparison with Technical Analysis Report
by P. Devika, Dr. S. Poornima
• (2016) J Hema and V Ariram in their research paper titled, “ Fundamental analysis with special
reference to pharmaceutical companies listed in NSE” stated that an investor should analyse the
market fundamentally and technically before investing in shares. They also noticed growth in the
pharmaceutical industry in India.
• (2011) Sugandharaj kulkarni in his research paper titled, “ A study on fundamental analysis of
ONGC” explains about the relevance of fundamental analysis along with the attempt to find the
intrinsic value of shares.
• (2015) Ahmed s Wafi, Hassan Hassan and Abel Mabrouk in their learning headed, “ Fundamental
analysis models in financial market” presented in third economic and finance conference in Rome.
This paper aims to find the better stock valuation model using the fundamental analysis approach.
12 Data Collection and Data Analysis
11.1 Fundamental Analysis
Infosys
Balance sheet and profit and loss statement analysis
Interpretation after analysis on balance sheet of INFOSYS LTD
Interpretation is done on basis of 5 years data from FY2016 to FY2020
Performance : Infosys performance has been significantly increased in past five years as there an improvement
in the revenue of the company, which has increased by approx. 45% in FY2020 to Rs. 90791 cores from RS.
68484 cores FY2016 Infosys has been continually showing progress in their revenue and showing a
compounded revenue growth of 11.23% for 5 years. As Infosys is the large cap company 11-12% revenue
growth is substantial. Infosys is showing a positive performance in terms of revenue growth in past 10 years at
14.19% and projecting revenue growth forecast for net 3 years at 9.85%
Efficiency : Infosys Efficiency in terms of cost of production for software has been decreased because
increasing cost of manufacturing and development of software, this might be due to the increasing demand for
the products and services of Infosys in recent years, However there is increase in the revenue of the company
that is due to increase in the sales which can justify the increase of Cost of producing and developing of
software’s.
Profitability : the overall profit for Infosys has been significantly increasing in past five years, Infosys has
improved and increased profits by 23% at Rs 16595 cores in FY 2020, Infosys do not have debt capital so also
do not had a burden for cost of finance through which the company enjoys more profitability, although recently
introduce small amount of debt in company in FY 2020 which haven’t effected the overall profitably much.
Infosys is sound stable in terms of profitability.
Net worth : Infosys net worth has been continuously increasing in the past few years, the major increase in net
worth is from retained earnings and surplus, that are increased because the company ploughing backs its profits
to source its financial needs in future, Infosys has a reserves growth 14 percent in past 10 years.
Capital Structure :Infosys capital structure has been changed recently in FY2020 in which the company has
introduced borrowed funds of Rs 4633 cores , In past 10 years Infosys didn’t have any long term debt in there
capital structure the company was funded by equity till FY2020, the share capital of company was constant till
FY2016 after which company has diluted the equity several times. No long term debt in past 4 years also
generated higher net profit for the company.
Working capital : Infosys working capital has been positive in last five years which show that company’s
current liabilities are backed by current assets, which is a good sing for the company, Infosys don not carry any
inventory which shows the quality of working capital is also good for the company in past five years.

TRENDS: 10 YEARS 5 YEARS 3 YEARS RECENT

Sales Growth 14.19% 11.23% 9.85% 9.82%
OPM 26.98% 25.86% 25.11% 24.53%
Price to Earning 19.28 18.22 18.05 19.20
Net profit 6.18% 4.98% 7.98%
9 Point Analysis of Infosys

Infosys
PROFITABILIY CRITERIA
2016 2017 2018 2019 2020
Net Income 13,489.00 14,353.00 16,029.00 15,404.00 16,594.00
Operating cash flows 10,028.00 11,531.00 13,218.00 14,841.00 17,003.00
Return on assets % 19.2 18.25 19.95 19.03 19.08
Cash flows from operating is more then net income in recent year indicating good quality of earnings

LEVERAGE, LIQUIDITY , AND SOURCE OF FUNDS CRITERIA

2016 2017 2018 2019 2020
Total Long Term Debt - - - - 4,633.00

Common stock TOTAL (no new share issued) 1,144.00 1,144.00 1,088.00 2,170.00 2,122.00

Current ratio 3.91 3.83 3.55 2.84 2.62

OPERATING EFFICIENCY CRITERIA

2016 2017 2018 2019 2020
Gross Profit 17,079.00 18,604.00 18,822.00 20,170.00 22,267.00
INDUSTRY COMPANY
Asset turnover ratio
1.1 1.39

Analysis and interpretations :

• Fundamental of Infosys are very strong as per the analysis, net income has been over all increasing in
last five years but also the operating cash flows are more the net income in FY2020 which indicated the
quality of earning is good in current year
• Infosys didn’t not had long term debt in last four year in FY 2020 company introduce the long term
debt, and assets turnover ratio is higher the industry standard that’s show company is using its assets
efficiently to generate sales.
• From 2018 company has diluted its equity to generated fund’s in the company, current ratio has been
decreasing in past five years but still good as company is able to pay off its current liability by its current
assets.
• operating efficiency of the company is showing positive trend as Gross profits for Infosys has been
continuously increasing. as per the analysis Infosys fundamental are strong and it is an attractive
company to invest.
Valuation Analysis
Infosys Valuation
Name - Infosys Ltd
Symbol - INFY
Sector - Technology
Last price - 748
Market Cap - 318,670 Cr
Price to book - 4.85
Discount rate (WACC) - 6.28%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
EPS 14.88 18.14 20.52 23.31 26.93 29.36 31.24 36.69 35.26 38.96
P/E Ratio 30.5 25.9 20.8 23.29 20.06 26.76 16.4 16.5 28.2 19.22

Valuation methods

• Earning Power Value

= Adjusted EPS*1*Discount Rate

Earning Power Value

Adjusted EPS 38.96
Discount rate (WACC) 6.28%
Infosys EPV 620.42

• P/E Based Valuation

Price per share = 10 Years Average P/E Ratio x 3 Years Average EPS
Since this intrinsic value depends on Earnings per Share which is based on reported earnings or
"accounting profits" which can be manipulated. We take the average EPS of the last 3 years instead of
the current EPS and average P/E ratio for the last 10 years instead of the last trailing 12 month P/E ratio.

PE Valuation As per PE base valuation the price for Infosys has

been estimated at Rs 841.59, whereas current market
Last 3 Years Average EPS 36.97 price is of Rs 748 which indicates as per PE valuation
Last 10 Years Average P/E 22.763 method Infosys is trading at discount and the price is
Infosys PE Valation price 841.59 attractive to the investor as the stock is undervalued.
 • Book Value Per Share & Graham Number model
Graham's Fair Value Price = Square Root of (22.5 x EPS x BVPS)
Graham Number was created by Benjamin Graham, the father of value investing. It calculates the
stock's maximum fair value based of its Earnings per share and Book value per share. Stocks trading
below their Graham Number may be undervalued.

Book Value Per Share & Graham Number Model As per graham
Last Price P/E ratio EPS Price to Book number model
INFOSYS LTD 748 19.22 38.96 4.85 of valuation
Book Value Per Share 154.23 price for
Infosys stock is
Graham number model 367.69
at Rs 367.69,
whereas the current market price is748 which is higher from graham number and indicates that’s Infosys
stock is overvalued and trading at premium and in as per book value per share the price in books of
company is 154.23 which also stats that the stock of Infosys is overvalued.

Intrinsic fair value share price range for Infosys ltd

Intrinsic fair value share price range As comparing all the valuation method The
Earning power value 620.42 average fair value comes to Rs. 495.98 taking an
Graham number model 367.69 safety margin of 20% the stock can be purchased
PE valuation 841.59 bellow the price of Rs 396.78.
Book value per share 154.23 Price below Rs 400 gives the indication for buy
Signal.
Average Fair Value 495.98
Margin of Safety 20% 99.20
Buy below 396.78

.
The Altman Z- Score Analysis

• The Altman Z-score is the output of a credit-strength test that gauges a publicly-traded manufacturing
company's likelihood of bankruptcy.

• The Altman Z-score is a formula for determining whether a company, notably in the manufacturing
space, is headed for bankruptcy.

• The formula takes into account profitability, leverage, liquidity, solvency, and activity ratios.

• An Altman Z-score close to 1.8 suggests a company might be headed for bankruptcy, while a score
closer to 3 suggests a company is in solid financial positioning.
Z-SCORE = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E

Infosys Altman Z-Score Analysis

Altman Z-Score
Criteria Ratio Z- Score
A = working capital / total assets 0.3981 0.4778
B = retained earnings / total assets 0.6898 0.9658
C = earnings before interest and tax / total assets 0.2416 0.7972
D = market value of equity / total liabilities 3.4714 2.0828
E = sales / total assets 0.9890 0.9890

TOTAL Z- SCORE 5.3125

• As per Altman Z- score analysis ,Infosys has a Z score of 5.3125 which is considered to be an good
score and indicates that the company is financially stable and have a good financial strength. And
Infosys is performing well in all the criteria’s.
• Also the Z-Score for Infosys is above 3, which shows that the company is in safe zone and investors
can consider to purchase Infosys stock.
Tata Consultancy Service
Balance sheet and profit and loss statement analysis
Interpretation after analysis on balance sheet of TATA CONSULTANCY SERVICE
Interpretation is done on basis of 5 years data from FY2016 to FY2020

Performance : Tata consultancy services performance has been substantially improved and increased in past
five years, the revenue of the company, which has increased by approx. 44% in FY2020 to Rs. 156949 cores
from RS. 108646 cores FY2016. Tata consultancy services has shown continually progress in their revenue with
compounded revenue growth of 10.64% for 5 years. As TCS is the large cap company 11-12% revenue growth
is substantial. TCS is indicating a positive performance in terms of revenue growth in past 10 years at 17.30%
and projecting revenue growth forecast for net 3 years at 10%
Efficiency : TCS been very efficient in terms of cost of production for software, As it has been decreased the
cost of manufacturing and development of software, although the cost are decreasing the revenue for the
company is increasing year on year which show that TCS is using its resource’s effectively into their operations,
and gain competitive differentiation and increase companies overall efficiency
Profitability : TCS overall profits has been significantly increasing in past five years, TCS has increased profits
by 33% at Rs 32340 cores in FY 2020 from Rs 24270 corers in 2016 , TCS has achieved more profit in recent
years by reducing cost of capital due to a more predictable and resilient business, and high cash conversion on
account of superior execution have resulted in a high return on equity. TSC profits has been grown with
compounded growth rate of 16.72% for 10 years and 2.82% in FY2020
Net worth : TCS net worth has been continuously increasing in the past few years, the major proportion of
increase in net worth is from retained earnings and surplus, TCS reserves has been showing up and down trend
in past five years which shows company is actively using’s its reserve to expand the business and also the
company ploughing its profits back to reserves fund to source its financial needs in future, Infosys has a
reserves growth 18 percent in past 10 years.
Capital Structure :TCS capital structure had a major change recently in FY2020 in which the company has
increased it borrowed funds to Rs 6906cores from 62 cores in FY2019, This will increase the burden of financial
cost to the company and it will slightly affect the profitability of the company. In past 10 years TCS had very
neglectable amount of borrowed funds compare to its equity in the capital structure the company was till
FY2019, the share capital of company was constant till FY2018 after which company has diluted the equity
several times.
Working capital : TCS working capital has been positive in last five years which indicates that company’s
current liabilities are backed by current assets, which is a good sing for the company, TCS has reduced its
proportion of inventory in past five years which is good for the company. Quality of working capital has been
improved for the company in past five years

TRENDS: 10 YEARS 5 YEARS 3 YEARS RECENT

Sales Growth 17.30% 10.64% 9.99% 7.16%
OPM 27.63% 27.12% 26.76% 26.83%
Price to Earning 22.38 21.57 22.69 24.58
Net income 16.12% 10.10% 7.17% 2.81%
9 Point Analysis of Tata consultancy services

Tata consultancy services

PROFITABILIY CRITERIA
2016 2017 2018 2019 2020
Net Income 24,270.00 26,289.00 25,826.00 31,472.00 32,340.00
Operating cash flows 19,109.00 25,223.00 25,067.00 28,593.00 32,369.00
Return on assets % 30.52 28.21 25.45 29.34 28.17
Cash flows from operating is more then net income in recent year indicating good quality of
earnings

LEVERAGE, LIQUIDITY , AND SOURCE OF FUNDS CRITERIA

2016 2017 2018 2019 2020
Total Long Term Debt 245.00 289.00 247.00 62.00 6,906.00

Common stock TOTAL (no

197.00 197.00 191.00 375.00 375.00
new share issued)
Current ratio 4.06 5.53 4.56 4.17 3.33

OPERATING EFFICIENCY CRITERIA

2016 2017 2018 2019 2020
Gross Profit 30,677.00 32,311.00 32,516.00 39,506.00 42,109.00
INDUSTRY COMPANY
Asset turnover ratio
1.1 1.33

Analysis and interpretations :

• Net income for TCS had been over all increasing in last five years, also operating cash flow are more
than net income in FY 2020, which shows that the quality of earing is good in the current year as
compare to last 4 years
• Long term borrowing was stable in till FY2019 where it has been decreased and it has been significantly
increased in the FY2020 which will end up giving finance cost burden to the company.
• Assets turnover ratio is higher the industry standard that’s show company is using its assets efficiently
to generate sales.
• From FY2018 company has diluted its equity to generate fund’s in the company ,Current ratio is
decreasing compare to previous year but still good as compare to industry standard as company it able
to pay off its current liabilities through current assets.
• TCS is showing improved operating efficiency as gross profits for the company is been continuously
increasing in past five years, as per the analysis TCS fundamental is strong and stocks are attractive to
investor.
Valuation Analysis
Tata consultancy services
Name - Tata consultancy services
Symbol - TCS
Sector - Technology
Last price - 2115
Market Cap - 795,074 Cr.
Price to book - 9.45
Discount rate (WACC) - 4.72%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
EPS 23.17 26.60 35.55 48.92 50.68 61.58 66.71 67.46 83.87 86.18
P/E Ratio 31.68 21.53 24.73 22.85 25.43 22.66 18.36 21.25 24.65 24.58

Valuation methods

• Earning Power Value

= Adjusted EPS*1*Discount Rate

Earning Power Value

Adjusted EPS 86.18
Discount rate (WACC) 4.72%
Infosys EPV 1,825.95

• P/E Based Valuation

Price per share = 10 Years Average P/E Ratio x 3 Years Average EPS
Since this intrinsic value depends on Earnings per Share which is based on reported earnings or
"accounting profits" which can be manipulated. We take the average EPS of the last 3 years instead of
the current EPS and average P/E ratio for the last 10 years instead of the last trailing 12 month P/E ratio.

As per PE base valuation the price for TCS has been

PE Valuation
estimated at Rs 1882.04, whereas current market
Last 3 Years Average EPS 79.17 price is of Rs 2115 which indicates as per PE
Last 10 Years Average P/E 23.772 valuation method Infosys is trading at premium and
TCS PE Valation price 1,882.04 the price is not attractive to the investor as the stock
is overvalued.
 • Book Value Per Share & Graham Number model
Graham's Fair Value Price = Square Root of (22.5 x EPS x BVPS)
Graham Number was created by Benjamin Graham, the father of value investing. It calculates the
stock's maximum fair value based of its Earnings per share and Book value per share. Stocks trading
below their Graham Number may be undervalued.

Book Value Per Share & Graham Number Model

Last Price P/E ratio EPS Price to Book
INFOSYS LTD 2115 24.58 86.18 9.45
Book Value Per Share 223.81
Graham number model 658.79

As per graham number model of valuation price for TCS stock is at Rs 658.79, whereas the current
market price is 2115 which is higher from graham number and indicates that’s TCS stock is overvalued
and trading at premium and in as per book value per share the price in books of company is 223.81
which also stats that the stock of Infosys is overvalued.
Intrinsic fair value share price range for tata consultancy services

Intrinsic fair value share price range As comparing all the valuation method The average
Earning power value 1,825.95 fair value comes to Rs. 1147.65 taking an safety
margin of 20% the stock can be purchased bellow the
Graham number model 658.79
price of Rs 918.12.
PE valuation 1,882.04
Price below Rs 920 gives the indication for buy
Book value per share 223.81 Signal

Average Fair Value 1,147.65

Margin of Safety 20% 229.53
Buy below 918.12

.
The Altman Z- Score Analysis

• The Altman Z-score is the output of a credit-strength test that gauges a publicly-traded manufacturing
company's likelihood of bankruptcy.

• The Altman Z-score is a formula for determining whether a company, notably in the manufacturing
space, is headed for bankruptcy.

• The formula takes into account profitability, leverage, liquidity, solvency, and activity ratios.

• An Altman Z-score close to 1.8 suggests a company might be headed for bankruptcy, while a score
closer to 3 suggests a company is in solid financial positioning.
Z-SCORE = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E

Tata Consultancy Services Altman Z Score analysis

Altman Z-Score
Criteria Ratio Z- Score
A = working capital / total assets 0.3567 0.4280
B = retained earnings / total assets 0.6972 0.9761
C = earnings before interest and tax / total assets 0.3594 1.1860
D = market value of equity / total liabilities 6.62 3.9714
E = sales / total assets 1.3066 1.3066

TOTAL Z- SCORE 7.8682

• As per Altman Z Score analysis TCS has a Z score of 7.868 which is considered to be a good z score
indicating that TCS is performing well in all the five criteria’s , TCS has a good financial strength.
• As TCS Z score is Above 3 means that the company is in a safe zone and is unlikely to file for
bankruptcy for long run and investor can consider to purchase stock of TCS as its minimal risk.
Wipro
Balance sheet and profit and loss statement analysis
Interpretation after analysis on balance sheet of WIPRO
Interpretation is done on basis of 5 years data from FY2016 to FY2020

Performance : Wipro performance has been improving y-o-y and increased in past five years, revenue of the
Wipro, is been increased by approx. 19% in FY2020 to Rs. 61137 cores from RS. 51244 cores FY2016. Wipro
has shown continually progress in their revenue with compounded revenue growth of 5.42% for 5 years. As
Wipro is the large cap company 11-12% revenue growth is substantial. But Wipro is growing at slower pace
compare to its peer and industry standard Wipro is indicating a positive performance in terms of revenue growth
in past 10 years at 7.82% and projecting revenue growth forecast for net 3 years at 3.59%
Efficiency : Wipro is doing well in term of efficiency as cost of production of software is being almost constant
with a change of approx. 2-3 percent every year in last 5years as it shows increase and decrease in cost of
manufacturing and developing software which can be justify as the revenue of the company has been increasing
in last five years, this might be due to increase in the demand of companies products.
Profitability : Wipro overall profits are increasing in past five years, Wipro has increased profits by 09% at Rs
9772 cores in FY 2020 from Rs 8907 corers in 2016 ,Wipro profits has been grown with compounded growth
rate of 7.9% for 10 years , and in last five year with a growth rate of 2.3%.
Net worth : Wipro’s net worth has been continuously increasing in the past few years, the major proportion of
increase in net worth is from retained earnings and surplus, company’s reserves has been showing up and down
trend in past five years which shows company is actively using’s its reserve to expand the business and also the
company ploughing its profits back to reserves fund to source its financial needs in future, In FY2020
company’s reduced by 2% this might be due to retained earnings used to maintain current operations, or to
invest in new ventures
Capital Structure :Wipro capital structure had a no major change recently in FY2020, recently the company
has reduced its borrowed funds in last four years by approx. 40% from 14241 cores to 9068 cores in FY2020
which shows that company is movie to more of equity to raise funds in the company ,This will reduce the burden
of financial cost to the company and it will positively affect and increase the profitability of the company, In
last five years company has diluted the equity several times.
Working capital : Wipro working capital has been positive in last five years which indicates that company’s
current liabilities are backed by current assets, which is a good sing for the company, Wipro has reduced its
proportion of inventory in past five years which is good for the company. Quality of working capital has been
improved for the company in past five years

TRENDS: 10 YEARS 5 YEARS 3 YEARS RECENT

Sales Growth 7.82% 5.42% 3.31% 3.59%
OPM 20.43% 20.07% 19.66% 20.18%
Price to Earning 16.57 14.70 14.44 13.25
Net income 8.30% 2.30% 3.80% 8.28%
9 Point Analysis

WIPRO
PROFITABILIY CRITERIA
2016 2017 2018 2019 2020
Net Income 8,907.90 8,493.10 8,002.80 9,003.70 9,722.30
Operating cash flows 7,887.30 9,277.30 8,423.30 11,631.60 10,064.30
Return on assets % 13.79 11.34 10.41 11.47 11.98
Cash flows from operating is more then net income in recent year indicating good quality of
earnings

LEVERAGE, LIQUIDITY , AND SOURCE OF FUNDS CRITERIA

2016 2017 2018 2019 2020
Total Long Term Debt 12,522.10 14,241.20 13,901.20 9,946.70 9,068.00

Common stock TOTAL (no

494.10 486.10 904.80 1,206.80 1,142.70
new share issued)
Current ratio 2.3 2.35 2.37 2.67 2.4

OPERATING EFFICIENCY CRITERIA

2016 2017 2018 2019 2020
Gross Profit 10,795.80 11,320.90 10,387.10 11,612.60 12,342.30
INDUSTRY COMPANY
Asset turnover ratio
1.1 0.74

Analysis and interpretation

• Net income for Wipro had been over all increasing in last five years, Operating cash flow are more than
net income in last four years, which shows that the quality of earing is good in the last 4 year.
• Long term borrowing are been reduced last four years by approx. 27% in the FY2020 which will help
the company to reduce its finance cost burden to the company. and also increase the profits for the
company
• Assets turnover ratio is lower the industry standard that’s show company is not using its assets
efficiently to generate sales. From last four years company has diluted its equity to generate fund’s in
the company
• Current ratio is decreasing compare to previous year but still good as compare to industry standard as
company it able to pay off its current liabilities through current assets.
• Wipro is showing improved operating efficiency as gross profits for the company is been continuously
increasing in past five years, as per the analysis Wipro fundamental is strong and stocks are attractive
to investor.
Valuation Analysis
Name - Wipro
Symbol - WIPR
Sector - Technology
Last price - 226
Market Cap - 128,832 Cr
Price to book - 2.3
Discount rate (WACC) - 4.04%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
EPS 8.09 8.55 9.36 12.08 13.15 13.52 13.10 13.27 14.92 17.02
P/E Ratio 24.13 22.66 19.44 18.75 16.61 15.46 14.65 15.24 18.49 13.56

Valuation methods

• Earning Power Value

= Adjusted EPS*1*Discount Rate

Earning Power Value

Adjusted EPS 17.02
Discount rate (WACC) 4.04%
Infosys EPV 421.20

• P/E Based Valuation

Price per share = 10 Years Average P/E Ratio x 3 Years Average EPS
Since this intrinsic value depends on Earnings per Share which is based on reported earnings or
"accounting profits" which can be manipulated. We take the average EPS of the last 3 years instead of
the current EPS and average P/E ratio for the last 10 years instead of the last trailing 12 month P/E ratio.
As per PE base valuation the price for Infosys has
PE Valuation been estimated at Rs 269.72, whereas current market
Last 3 Years Average EPS 15.07 price is of Rs 226 which indicates as per PE valuation
Last 10 Years Average P/E 17.899 method Infosys is trading at discount and the price is
TCS PE Valation price 269.72 attractive to the investor as the stock is undervalued.

• Book Value Per Share & Graham Number model

Graham's Fair Value Price = Square Root of (22.5 x EPS x BVPS)
Graham Number was created by Benjamin Graham, the father of value investing. It calculates the
stock's maximum fair value based of its Earnings per share and Book value per share. Stocks trading
below their Graham Number may be undervalued.
 Book Value Per Share & Graham Number Model
Last Price P/E ratio EPS Price to Book
INFOSYS LTD 226 13.56 17.02 2.3
Book Value Per Share 98.26
Graham number model 193.96

As per graham number model of valuation price for Wipro stock is at Rs 193.96, whereas the current
market price is 226 which is higher from graham number and indicates that’s Wipro stock is
overvalued and trading at premium and in as per book value per share the price in books of company
is 98.26 which also stats that the stock of Wipro is overvalued.

Intrinsic fair value share price range for Infosys ltd

Intrinsic fair value share price range As comparing all the valuation method The average
Earning power value 421.20 fair value comes to Rs. 245 taking an safety margin
Graham number model 193.96 of 20% the stock can be purchased bellow the price
of Rs 196.63.
PE valuation 269.72
Book value per share 98.26 Price below Rs 200 gives the indication for buy

Average Fair Value 245.79

Margin of Safety 20% 49.16
Buy below 196.63

The Altman Z- Score Analysis

• The Altman Z-score is the output of a credit-strength test that gauges a publicly-traded manufacturing
company's likelihood of bankruptcy.
• The Altman Z-score is a formula for determining whether a company, notably in the manufacturing
space, is headed for bankruptcy.
• The formula takes into account profitability, leverage, liquidity, solvency, and activity ratios.
• An Altman Z-score close to 1.8 suggests a company might be headed for bankruptcy, while a score
closer to 3 suggests a company is in solid financial positioning.
Z-SCORE = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E
Wipro Altman Z Score analysis

Altman Z-Score
Criteria Ratio Z- Score
A = working capital / total assets 0.2520 0.3024
B = retained earnings / total assets 0.6689 0.9364
C = earnings before interest and tax / total assets 0.1603 0.5290
D = market value of equity / total liabilities 1.5905 0.9543
E = sales / total assets 0.7548 0.7548

TOTAL Z- SCORE 3.4770

• As per Altman Z score analysis Wipro has a Z score of 3.47, which is higher and a good score and
indicates is performing well in all the given criteria and company has good financial strength.
• As z Score is above 3, investor can consider to purchase the stock of Wipro.
11.2 Technical Analysis
Infosys
Trend Analysis
Price Trend of Infosys

• Infosys price has been show Up Trend in last three to four months with current price of Rs 730, it has
also seen down trend before the uptrend.

TCS
Price Trend of tata consultancy services
 • Tata consultancy services stocks are moving consolidated trend in which the stock price are moving
low of Rs 1700 to high of Rs 2200 , and this indicated that the stocks might see an up trend in next
few days.

Wipro
Price Trend of Wipro

• Wipro has been seeing an down trend in last three months from high of Rs 300 to low of Rs 219 in
Three months , before an down trend he company had an up trend which shows the company share
price were going high till may 2020
Relative strength Index Indicator
Relative strength index is a momentum oscillator that measures the speed and change of price movements. It
oscillates between zero and 100, RSI is considered overbought when above 70 and oversold when below 30.
The Relative Strength Index (RSI) is one of the most popular technical indicators that can help you determine
overbought and oversold price levels as well as generate buy and sell signals.
Infosys

• Relative strength index for Infosys is 50. Currently TCS share price and RSI both are in up trend,
Infosys RSI value is between 35 to 65 that indicate no entry or exit point for traders, showing a
neutral signal for Infosys stocks
Tata consultancy services
 • Relative strength index for Tata consultancy service is 55. Currently TCS share price and RSI both are
in up trend, TCS RSI value is between 35 to 65 that indicate no entry or exit point for traders,
showing a neutral signal

Wipro

• Wipro Relative strengths index is 46 and currently in uptrends , as RSI is between 35 to 65 that
indicate no entry or exit point for traders, showing a neutral signal for Wipro stocks.
12 Key Findings

• As Per sector analysis it is seen that Indian Information and technology sector has been growing at
good pace with a growth rate of The IT sector revenue was $177 billion in FY 2019, $136 billion was
from export and $41 billion from domestic revenue. IT-BPM sector was estimated at $191 in FY2020
at 7.7 percent growth y-o-y.
• Major revenue in Indian IT sector comes from It services by approx. 51 percent, and major proportion
of revenue is from export sector, Us is the major client for Indian IT services
• The export revenue has been seen a growth at a CAGR of 8.05 percent during the FY2016 – FY2019.
• major share of revenue of IT major firms comes from the BFSI business vertical.
• Fundamental of all the three companies are found to be good , Financial strength all of the comes had
been seen to be good.
• TCS revenues has been increased in greater proportion compare to Infosys and Wipro
• According to Valuation method of Infosys average fair value is Rs. 495.98, TCS average fair value is
Rs. 1147.65, Wipro average fair value comes to Rs. 245
• Shares of Wipro, TCS and Infosys are overvalued as market price is greater than the internist value
calculated by valuation methods
• Relative strength index has been between 35-65 for all the three companies indicating neutral signal
for investors
• As per Altman Z Score analysis all the three companies has a score greater than 3 which indicate that
the companies are financial strong and have a future growth prospect with higher growth of profits
and value creation for investors

13 Conclusion and Recommendations

Recommendations and suggestions:

• It is recommended to sell the share which are overvalued like Wipro, TCS,
and Infosys as their share prices have a tendency to decrease or raise in the future.
• Every investor is recommended to make a thorough analysis of the capital market, about the
company and industry before making any investment decision.
• Investing in one share alone is not suggested as returns may not be favourable always, making
investment in diversified shares reduces the risk and provides a stable returns.

Conclusion:
Indian Information and technology sector is one of the fastest growing sector in the country which also
have a great contribution in Indian economy of the country, Indian IT sector has various growth
opportunity in FY2020 but also seen a down trend as the global economy has hit hard by COVID-19
pandemic. Through the challenges are faced Indian IT sector is has been showing overall stability over
the years and become an one of the profitable sector in the country. The three major IT companies tata
consultancy services, Infosys and Wipro have very strong financial strength and also have an increasing
growth profits year on year. Looking at the fundamental analysis of all the three companies it is
advisable to investor to make an investments in the companies as all the three companies are creating
value for investors’ money .
Wipro, TCS, Infosys is overvalues as its intrinsic value is lower than its market value and suggested to
sell the share since the price of the same may decrease in future. Since the IT Sector is the fastest
growing sector It is recommended for investors to have IT sector companies in their portfolio. In
conclusion the Indian Information Technology sector companies is one most promising sector of
 investment in stock market and it also gives the return for investment to the investor who willing to take
risk in the market.

14 References

• https://www.tcs.com
• https://www.infosys.com/
• https://www.investing.com/
• https://www.macrotrends.net/
• https://www.wipro.com
• https://www.screener.in/
• https://www.moneycontrol.com/
• https://www.indiaservices.in/it-ites
• https://www.ibef.org/
• https://www.nasscom.in