Bad news for Ratan Tata's TCS after massive layoffs, IT giant loses Rs 5.66 lakh crore due to..., worst phase for company since...
TCS market cap: Amidst the backdrop of the controversy surrounding its decision to cut more than 12,000 jobs in the current fiscal year, Tata Consultancy Services (TCS), India's largest IT services exporter, has witnessed a rout of its market cap, which slumped from Rs 16.57 lakh crore to Rs 10.93 lakh crore, a decrease of Rs 5.66 lakh crore.
According to market analysts, TCS, the flagship company of the Tata Group, is going through it worst crisis since the 2008 recession, when it shares had fallen by 55 percent. TCS share prices have dipped 25 percent in 2025, and experts predict the current financial could be the worst in company's history if the downfall continues. Why TCS shares are falling?
According to analysts, India's stock market has witnessed a turmoil over the past few months as foreign investors are withdrawing from the market in droves amid US President Donald Trump unleashing tariff war against India, and recently announcing 50% import duty on Indian exports.
The IT industry, once considered a favorite for FIIs, is now witnessing a decline, with foreign investors reducing their stake in TCS from 12.35% in June 2024 to 11.48% in June 2025, which has resulted in the company's shares falling by over 25 percent in the current financial year.
The Nifty IT index has fallen 25% so far this year, making it the worst-performing sector in the market as over half of the Rs 95,600 crore withdrawn from India by FIIs till July 2025 has come from IT stocks alone. Why mutual funds investment increased?
Meanwhile, domestic mutual funds have raised their stake in TCS from 4.25% to 5.13%, making fresh purchases worth Rs 400 crore in the company, according to data. TCS' trailing PE declined from 41x to 20x, five-year CAGR stands at 8.5%, while stock CAGR is 6%, the data showed.
Notably, India's IT sector has grown at a compounded annual rate of 12.5% over the last two decades, but has underperformed the Nifty over the last three to five years. TCS layoffs
According to recent media reports, TCS is mulling to cut about 2 percent of its global workforce, which would result in over 12,000 TCS workers losing their jobs in the current financial year. The company's decision is being investigated, with Jefferies warning that TCS layoffs could result in a slowdown in execution in the near term and an increase in the workforce in the long term.
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