Why TCS Share Price is Falling
Feb 4, 2026
Image source: Lemon_tm/www.istockphoto.comThe IT sector has become a key driver for India’s economic growth, contributing significantly to the country’s GDP and welfare.
With digital tech advancing across industries, India stands at the forefront of the next big tech revolution.
One such indirect beneficiary is Tata Consultancy Services (TCS). The company is a leading global IT services, consulting, and business solutions organization, and part of the Tata Group, India’s largest multinational conglomerate.
The share is now in the spotlight, and unfortunately, it’s for all the wrong reasons as its share price has dropped 7% today.
What caused this sudden drop?
# AI Pressure
The shares of Indian IT companies, including TCS, fell 7% on Wednesday.
The sharp fall in share price also dragged the Nifty IT index down by up to7%.
So, what’s behind the sudden fall? The buzzword is artificial intelligence (AI).
According to the Moneycontrol report, Wall Street closed sharply lower in the previous sessions as investors grew nervous that artificial intelligence is increasing competition in software companies.
The concerns intensified after AI firm Anthropic introduced a new legal tool for its Claude AI chatbot.
Last week, Anthropic also rolled out new plug-ins for its Claude Coworkl agent, allowing it to automate work across areas like legal services, sales, marketing, and data analysis.
This has sparked fears that AI could soon disrupt the data and professional services industry, sectors that were once expected to benefit the most from the AI boom.
This could be the main reason for the share price to decline.
What Next for TCS?
TCS is strengthening its future by making significant investments in AI, cloud, and data centres.
Partnerships with major players like TPG, Google Cloud, and hyperscale’s demonstrate its goal to build large-scale AI infrastructure and effective AI solutions for businesses.
The company is also expanding its consulting and cloud capabilities through acquisitions like Coastal Cloud. This helps it provide better sales, marketing, and customer service solutions.
Long-term contracts with clients such as Canada Life and Tata Motors underline TCS’s commitment to large digital transformation projects, sustainability, and managed services.
Overall, TCS is positioning itself for long-term growth. It aims to lead in AI-driven services, sustainable technology, and global digital transformation while creating jobs and increasing its presence in key markets like the UK.
How TCS Share Price Has Performed Recently
TCS shares have fallen 5% over the last five sessions.
The stock touched its 52-week high of Rs 4,161 on 5 February 2025 and its 52-week low of Rs 2,867 on 1 October 2025.
About TCS
TCS is a leading global IT services, consulting, and business solutions organisation, and part of the Tata Group, India’s largest multinational conglomerate.
TCS partners with industry-leading companies to drive digital transformation and innovation. The company helps clients evolve by applying and scaling new technologies, like modern Artificial Intelligence and cloud solutions.
The company is recognised for its engineering excellence, high standards of customer service, and long-term client relationships that often span decades.
To know more, check out the TCS fact sheet and latest quarterly results.
For a sector overview, read our IT sector report.
You can also compare TCS with its peers on our website.
To know what’s moving the Indian stock markets today, check out the most recent share market updates here.
Investors should evaluate the company’s fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.
Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here…
