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IT stocks index jumps 5% as Infosys, TCS power market gains

IT stocks are the top gainers on BSE after Infosys and TCS announced their quarterly results.

New Delhi, Jan 12,2024:  IT stocks are the top gainers on BSE after Infosys and TCS announced their quarterly results.

BSE IT Index is up almost 5 per cent on Friday, by far the biggest gainer amongst all sectors.

Among the stocks, Infosys is up 7.6 per cent, Sonata Software is up 7 per cent, Datamatics is up 6 per cent, Coforge is up 5 per cent, Tech Mahindra is up 4 per cent, TCS is up 4 per cent, Wipro is up 4 per cent, Mphasis is up 4 per cent.

Elara Securities said in a report that Infosys Q3 results reflect persistent revenue leakage; weak discretionary demand and disparity between deal wins and revenue growth.

“We find no green-shoots in management commentary regarding revenue growth outlook and assess limited room to utilize traditional margin levers (utilization at 82.7 per cent). With two quarters of revenue decline in H2FY24 (revised guidance implies a 0.7 per cent QoQ revenue dip in Q4E at mid-point), Infosys has had a very weak start to FY25,” the report said.

Elara Securities said Tata Consultancy Services (TCS) delivered a revenue beat after two misses. Q3FY24 revenue was up 1 per cent QoQ beating both median consensus estimates of 0.2 per cent growth and our estimate of 1 per cent contraction.

V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services said with inline results from Infosys and better-than-expected results from TCS, IT stocks will see some action today. Even though there is no positive message from the management commentary, the market is likely to respond positively to the absence of any bad news. But the upside for TCS and Infy will be limited since it will take time for clarity to emerge on the prospects for the sector in FY25.

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