Target: ₹2,350CMP: ₹2,271TCS will acquire Porsche’s IT consulting arm, MHP, for €320 million, implying an attractive 0.43x CY25 sales multiple. This marks TCS’ third acquisition in the past 12 months, underscoring a more active inorganic approach after a long period of limited M&A activity. TCS’ stock has underperformed its large peers over one-month basis. MHP brings strong capabilities in automotive, manufacturing, AI, SAP and digital transformation, but its revenue declined 11 per cent year on year to €742 million in CY25 and its onsite-heavy model likely implies lower margins than TCS.While the deal contributes only about 2.7 per cent of TCS’ estimated FY28E revenue, the attached €1.25-billion five-year Porsche contract provides revenue visibility and lowers execution risk. Overall, the acquisition is strategically important as it deepens TCS’ presence in Germany and the European automotive ecosystem, though it may be mildly margin dilutive in the near term. Porsche’s five-year contract is subject to regulatory and antitrust approvals and is expected to close within the next three-four months. We retain our 14x target P/E multiple, supported by improving client cohort metrics, a 5 per cent payout yield and an attractive 6.5 per cent FCF yield. Accordingly, we maintain our Hold rating with a revised target price of ₹2,350, roll over and value the stock at 14x September 2028E EPS.Published on August 26, 2026