Shares of Tata Consultancy Services Ltd (TCS) are in news today after the IT giant said a United States District Court imposed a penalty of about $194.2 million (approximately Rs 1,600 crore) on the firm in multiple charges alleging misappropriation of its trade secrets. On Friday, shares of TCS ended 1.17% lower at Rs 3831.95 on BSE. TCS stock opened higher at Rs 3,885 in the same session. Market cap of the firm fell to Rs 13.86 lakh crore. Total 0.67 lakh shares changed hands amounting to a turnover of Rs 25.68 crore on BSE.
TCS stock has a one-year beta of 0.4, signaling low volatility during the period. In terms of technicals, the relative strength index (RSI) of TCS stood at 49.4, signaling it's trading neither in the overbought nor in the oversold zone.
TCS shares stand higher than the 10 day, 20 day and 200 day but lower than the 30 day, 50 day, 100 day and 150 day moving averages.
TCS shares have rallied 18% in a year and risen 19.33% in two years.
"...we hereby inform you that the Company has received an adverse judgement passed by United States District Court, Northern District of Texas, Dallas Division," said TCS to a stock exchange filing.
Computer Sciences Corporation (CSC), now DXC Technology Company (DXC), filed the case against TCS alleging that the Indian IT firm misappropriated its trade secrets.
"The court ordered that the company was liable to CSC for $56,151,583 in compensatory damages and USD 112,303,166 in exemplary damages. The court also assessed that the company is liable for USD 25,773,576.60 in prejudgment interest through June 13, 2024," the IT major said.
TCS said it has strong arguments to counter the ruling and plans to defend its position through a review petition or an appeal to the appropriate court. The company received the court order on June 14, 2024.
The judgment will not have a major adverse impact on its financials and operations. The company is taking the necessary steps to protect its interests and address the legal challenges presented by this ruling, said the Indian IT giant.
"The company believes that it has strong arguments in the matter and intends to defend its position through review petition/appeal to the appropriate Court," TCS said