Tata Consultancy Services (TCS), a leading IT services company, has declared its second interim dividend for the financial year 2026, offering shareholders Rs 11.00 per equity share. The company has set key dates for dividend eligibility, emphasizing the importance of the new T+1 settlement cycle in India.

Dividend Details and Important Dates

Investors should note that October 14 is the final day to purchase TCS shares to qualify for this dividend. Under India's T+1 settlement cycle, shares bought on the record date (October 15) will not be eligible for the dividend.

Previous Dividend and Stock Performance

TCS has maintained consistency in its dividend payouts, having previously distributed Rs 11.00 as its first interim dividend for FY26. However, the company's stock has faced challenges in the market:

• Year-to-date decline: 27.00%
• 12-month decline: 27.00%

Tax Implications for Investors

Resident individual investors should be aware of the tax implications on dividend income:

• Dividend income exceeding Rs 5,000.00 annually is subject to 10% TDS (Tax Deducted at Source)

This announcement comes as part of TCS's ongoing commitment to delivering value to its shareholders, despite the recent stock performance challenges. Investors are advised to consider these dates and tax implications when making investment decisions regarding TCS shares.

Tata Consultancy Services (TCS), India's largest IT services company, has reported its second-quarter results, which were largely in line with market expectations. However, the company's dollar revenue growth remained subdued, reflecting broader challenges in the IT sector.

Key Highlights

Analyst Insights

Dhananjay Sinha from Systematix Group provided the following observations:

• TCS demonstrated strong deal wins in the quarter
• The company is investing in data centers to address H-1B visa concerns
• Revenue realization remains uncertain

IT Sector Outlook

The IT sector is facing emerging risks that could impact Indian IT exporters:

• Protectionist trends extending into services
• Challenges in revenue growth visibility
• Cautious investor sentiment

Valuation

Despite the challenges, TCS's valuation remains attractive:

However, investor sentiment may remain cautious until there's improved visibility on revenue growth.

Banking Sector Update

The article also touched upon the banking sector:

• Margins expected to remain under pressure
• Modest pickup in lending activity in September
• Slowing deposit growth
• Credit-deposit ratios above 80%
• PSU banks may offer selective opportunities due to lower valuations compared to private peers

Market Rotation

A shift in market preferences was noted:

• Favoring auto stocks over financials
• Reasons: Better operational performance and earnings visibility in the auto sector

As the IT sector navigates through global uncertainties and protectionist trends, companies like TCS are adapting by focusing on strong deal wins and strategic investments. However, the path to robust revenue growth remains challenging in the current environment.