IT stocks had been the prime BSE Sensex contributors in today’s upbeat trade. Out of 30 Sensex stocks, the prime 3 gainers had been Tech Mahindra, HCL Technologies and Infosys. Also, Tata Consultancy Services (TCS) shares hit a fresh 52-week higher of Rs Rs 3,327 apiece, increasing practically 2 per cent from the prior close. Similarly, shares of Tata Elxsi also scaled a fresh 52-week of Rs 2,826 apiece. So far, most of the IT providers have reported far better-than-anticipated October-December quarter earnings and revised income guidance for FY21. According to an analyst, enterprise technologies spends are probably to stay resilient more than the medium term. “We expect Indian IT names to report strong double-digit revenue growth in FY22/FY23 driven by continued deal win momentum,” Suyog Kulkarni, Senior Research Analyst, Reliance Securities told TheSpuzz Online.
Kulkarni also mentioned that Nifty IT is probably to appreciate premium valuation vs broader marketplace-driven by mid-term development visibility, elevated margins and constant money return policy. All the ten Nifty IT constituents had been trading in the positive territory with the Nifty IT index at 26,758.10 level. Along with TCS, Mindtree shares have also produced a new 52-week higher today, post robust third-quarter earnings.
AR Ramachandran, Co-founder & Trainer, Tips2Trade, told TheSpuzz Online that with robust Q3FY21 benefits and buoyant marketplace sentiment, it is no surprise that TCS & and Tata Elxsi are producing newer highs. “However, markets are extremely exuberant and hence every uptrend now should be used to book profits and wait for at least a 10-15% correction for fresh buy positions,” he added
Analysts at Axis Securities see 16 per cent upside in the stock. Mindtree management also guided for investment, timely tactic refresh led by the consolidation of service lines, interest towards multi-year engagements and concentrate on scaling prime accounts can help sales traction. “We believe Mindtree has a resilient business structure from a long term perspective and strong execution strategy,” they added.
In comparison, S&P BSE Sensex was trading 254 points or .51 per cent larger at 49,652, whilst the broader Nifty 50 index gained 80 points or .55 per cent to rule at 14,601.