TCS shares in focus as IT major sets up new AI transformation unit

Shares of Tata Consultancy Services (TCS) are likely to be in focus on Thursday after reports said India’s largest IT services firm has set up a dedicated artificial intelligence (AI) and services transformation unit, highlighting its push to leverage the fast-evolving technology.

According to a company memo reviewed by Reuters, the new unit will consolidate TCS’ existing AI capabilities to develop deeper domain-specific solutions and accelerate innovation across client industries.

The memo also stated that Amit Kapur, a two-decade veteran at the firm who most recently led TCS’s UK and Ireland business, has been appointed chief of the unit and will formally assume charge in September.

Betting on AI amid industry strain

“Over the last few years, TCS has made significant strides in AI by scaling capabilities, reskilling its workforce, and strengthening partnerships,” the company said in the memo, according to Reuters.

The launch of the AI and services transformation division comes barely a month after the IT major announced plans to cut 12,000 jobs. The move has heightened concerns that India’s $283 billion outsourcing industry—long a source of steady employment—may face more layoffs as AI adoption accelerates.

Indian IT firms have also been struggling with subdued client spending for several quarters amid global macroeconomic headwinds. With customers holding back on discretionary tech investments, companies like TCS are increasingly betting on AI-led solutions to revive growth and sharpen their competitive edge.

First among Indian peers

TCS has become the first Indian IT major to set up a business unit dedicated exclusively to AI and related technologies, mirroring a similar move by U.S. rival Accenture in June. The parallel underscores how outsourcing giants worldwide are racing to retool their business models for an AI-driven future.

For TCS, the new division represents more than a structural reshuffle—it signals that AI will be central to its client offerings and a key driver of future growth.

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