Analysts Warn TCS Pullback May Be Short-Lived, Flag Key Levels to Track

TCS Faces Short-Term Resistance Despite Recent Earnings Beat

Analysts suggest that Tata Consultancy Services’ recent stock pullback may not last long, but key resistance levels will be critical to watch.

Earnings Performance Exceeds Expectations

TCS reported a robust 14.9% year-on-year growth in net profit for Q2FY27, reaching ₹13,884 crore, surpassing analyst expectations. Revenue from operations also rose by 11.2% year-on-year to ₹73,188 crore, slightly above the projected ₹73,108 crore. This performance has led to a positive reaction in the stock market, with TCS shares climbing to an intraday high of ₹2,184 on the NSE.

Despite this positive momentum, TCS shares have been underperforming in 2026, down nearly 32% year-to-date and over 50% from their peak of ₹4,386 in August 2024. Analysts from Nomura and Motilal Oswal have reiterated their “Buy” ratings, citing growth visibility from deal bookings and improving international demand as key drivers for TCS’s future performance.

Technical Analysis Indicates Resistance Levels

From a technical standpoint, analysts at Choice Broking highlight that TCS continues to trade below key daily, weekly, and monthly Exponential Moving Averages (EMAs). Hitesh Tailor, a Technical Research Analyst, notes that the persistent downward trend of these moving averages indicates underlying supply pressure, suggesting that any minor pullbacks are likely to encounter selling interest.

Tailor identifies significant overhead resistance between ₹2,250 and ₹2,330, where previous breakdown zones align with declining weekly EMAs. Conversely, he points to the ₹2,000–₹2,020 range as immediate psychological and structural support. A decisive weekly close below ₹2,000 could trigger a severe technical breakdown, potentially pushing the stock down to ₹1,850 and ₹1,750 levels.

Derivatives Insights and Market Sentiment

In the derivatives market, analysts have observed no fresh directional build-up ahead of TCS’s Q2 results. TCS futures open interest (OI) was reported at 259.6 lakh shares, down slightly by 0.4 lakh. Notably, call OI surged by approximately 50% to 227 lakh, indicating increased interest in TCS call options, particularly at the ₹2,300 and ₹2,200 strikes. However, the put-call ratio has fallen to 0.61 from 0.69, suggesting a cautious sentiment among traders.

Dharmesh Bhatt, Head of Derivatives Research at Systematix, emphasizes that while a break above ₹2,150 could lift TCS shares towards ₹2,200, the existing futures and options positions do not support a bullish outlook towards ₹2,250–₹2,300. Confirmation of upward momentum would require a decline in call OI between ₹2,100 and ₹2,200 or a stock close above ₹2,150.

Key Highlights

• TCS reported a 14.9% YoY growth in net profit for Q2FY27, reaching ₹13,884 crore.
• Revenue from operations rose by 11.2% YoY to ₹73,188 crore, surpassing estimates.
• Analysts from Nomura and Motilal Oswal maintain “Buy” ratings on TCS.
• Key resistance levels identified between ₹2,250 and ₹2,330.
• Immediate support seen at ₹2,000–₹2,020; a close below this level may indicate further declines.

Investor Note: Investors should closely monitor TCS’s stock price movements around key resistance and support levels, as these will be crucial in determining the stock’s short-term trajectory following its recent earnings report.