TCS shares rise before cooling off as firm acquires Coastal Cloud; here's what analysts at Morgan Stanley said

The deal will make Tata Consultancy Services (TCS) among the top five Salesforce advisory and consulting firms globally.

TCS in a regulatory filing said Coastal Cloud brings AI-led advisory and business consulting capabilities to help customers reimagine sales, service, marketing, revenue, CPQ, commerce and Salesforce data cloud. As a Salesforce Summit Partner, Coastal Cloud excels in building deep customer relationships and partnerships, TCS said in a statement.

TCS “has signed a definitive agreement to acquire a 100% stake in Coastal Cloud, a leading Salesforce Summit partner that specialises in Salesforce Consulting for an all-cash consideration of $700 million,” the company said in a regulatory filing.

Led by Eric Berridge, Coastal Cloud is a proven Salesforce veteran who has built and scaled category-leading Salesforce services ventures. Salesforce Ventures has been a strategic investor in this firm.

“This acquisition marks a pivotal milestone in advancing our global Salesforce capabilities and accelerating our AI-led transformation agenda. It is another significant step towards realising TCS’s vision of becoming the world’s largest AI-led technology services company. By adding over 400 multi-cloud specialists with deep industry expertise, we are strengthening our advisory and business consulting capabilities and enhancing our AI and data offerings," said Aarthi Subramanian, chief operating officer of the company.

In October 2025, TCS had strengthened its Salesforce practice with its ListEngage acquisition, a Summit Partner recognised for its Agentforce, Marketing and Commerce Cloud expertise. With Coastal Cloud, TCS has further strengthened its Salesforce advisory and business consulting capabilities across verticals globally by adding over 400 seasoned professionals with more than 3,000 multi-cloud certifications.

Coastal Cloud was founded in 2012 and positions itself as a multi-cloud Salesforce consulting firm, specialising in enterprise-scale transformations, including AI-led advisory and business consulting capabilities to help customers reimagine sales, service, marketing, revenue, CPQ, commerce and Salesforce data cloud.

The new acquisition comes months after TCS, which was perceived to be conservative from an inorganic growth-chasing perspective, strengthened its Salesforce practice with its ListEngage acquisition.

Commenting on the acquisition, Eric Berridge, CEO, Coastal Cloud, said, “This is an exciting new chapter for Coastal Cloud, and joining TCS enables us to serve our customers’ evolving needs with even greater depth, speed, and scale. Our team’s Salesforce and multicloud expertise, combined with TCS’ global reach, advanced AI capabilities and enterprise-scale solutions, will allow us to support customers across a broader spectrum of transformation needs.”

These acquisitions boost TCS’ global Salesforce ambitions by adding strong multi-cloud expertise across industries. With more skilled talent and complementary delivery capabilities, TCS can now offer better results to clients and drive faster growth in major markets.

Morgan Stanley on the acquisition

Analysts at Morgan Stanley said the acquisition of Coastal Cloud aligns with TCS’s recent strategic shift, calling it a bold move given the company’s size and the deal’s price-to-sales multiples. They noted that the acquisition is likely to contribute less than 0.5% to TCS’s overall revenue growth, with a minimal EPS impact of under 1% dilutive for FY27E. Coastal Cloud reported LTM revenue of $141 million as of September 2025, implying an EV/s of around 5 times.

The transaction is expected to close by January 31, 2026, subject to Hart-Scott-Rodino antitrust approval in the US. After the acquisition, TCS is set to become one of the top five Salesforce advisory and consulting firms globally.

TCS share price

After opening at ₹3,189.20 apiece, shares of TCS rose 0.6% to an intraday high of ₹3,208.4 apiece and a low of ₹3,160. At 10:23 AM, the stock was trading at ₹3,181 apiece on the National Stock Exchange, falling 0.26%.

Shares of the IT major have lost 2% over the past five days, while they declined over 8% in the last six months. Since the beginning of 2025, TCS shares have fallen 23%.

The company has a total market capitalisation of ₹11.50 lakh crore, according to data on the NSE.