Shares of Tata Consultancy Services (TCS) hit a four-month low of Rs 3,145, down 1% in Friday’s intraday trade following the firm’s MD and CEO Rajesh Gopinathan on Thursday. He decided to step down to pursue other interests. Shares of information technology (IT) majors were quoted at their lowest level since October 27, 2022.

In his six years as CEO, TCS has added more than $10 billion in incremental revenue and $70 billion in market capitalisation.

The Board of Directors has nominated K Krithivasan as CEO-Designate, effective March 16, 2023. Gopinath will remain with the company until September 15, 2023, to provide transition and support to his successor.

Gopinathan was first named TCS CEO and MD in FY17 after serving as CFO since FY13. His first term as CEO was from FY17 to FY22, and last year he was reappointed as CEO and MD until FY27.

The press release indicates that Gopinathan’s departure is not sudden, as Gopinathan has been discussing his plans for the next phase of his life with the chairman and board, and together they decided that the end of the fiscal year was a good one. In a report, ICICI Securities said it was time for him to resign and pursue these interests.

Gopinathan will remain with the company for almost six months from today, marking a smooth leadership transition. However, in our view, K Krithivasan may serve as interim CEO based on age as he is likely to be close to 60, and his tenure as CEO was not mentioned in the press release, the brokerage said.

At 10:30 am, TCS pared most of the day’s losses, falling 0.3% to Rs 3,176, while the S&P BSE Sensex rose 0.5%. The stock has lost 9% over the past month, underperforming the broader market, compared with a 5% drop in the benchmark index.

TCS shares plunged 12% from its February 16, 2023, high of Rs 3,575. The stock is currently trading in negative territory as it trades all its key moving averages on the daily chart below.

On a weekly scale, the stock finds support near its two-year trendline at Rs 3,150-plus levels, which also coincides with the lower end of the Bollinger Bands.

Expect some consolidation on the counter if the stock stays above this level. However, the upside seems capped at around Rs 3,340 to Rs 3,400.

Meanwhile, sustained trading below Rs 3,150 could trigger a decline towards the Rs 3,000 mark.