Sasmita Jena
Bengaluru, 14 October 2024
Nifty IT index, which measures the movement of major IT services and technology firms in India, is likely to take cues from upcoming Q2 earnings of large IT services firms including Infosys and HCLTech.
The Nifty IT Index gained 0.34% to end last week (September 11) at 42,335. TCS Q2 results, which was announced on October 10, provided trigger for the next leg of movement in the Nifty IT index.
The share price of TCS lost 2.96% last week to settle at Rs 4,146. Infosys share price gained marginally by 0.3% to close at Rs 1,935 on last Friday. HCLTech’s share price closed 2.41% up at Rs 1,839.95 last week.
Though TCS’ Q2 earnings missed analysts estimates on profitability and net profit fronts, the deal wins and management commentary provides hopes of good times ahead for the IT industry. Especially, the green shoots seen in the BFSI (banking, financial services & insurance) vertical boosted recovery hopes.
“We saw the cautious trends of the last few quarters continue to play out in this quarter as well. Amidst an uncertain geopolitical situation, our biggest vertical, BFSI showed signs of recovery,” K Krithivasan, Chief Executive Officer & MD of TCS said.
BFSI is the largest vertical for all large and most mid-tier IT services firms. Its recovery in the US raises hopes of demand recovery.
Meanwhile, the market will take cues from the earnings of HCLTech and Infosys this week. HCLTech will announce its results on October 14 (Monday), while Infosys is scheduled to declare its Q2 earnings on October 17 (Thursday).
HCLTech is expected to report a revenue growth at 7.1%-9.2% on a year-on-year basis for the quarter ended September 30, according to brokerage estimates.
Among midcaps, engineering services firm- L&T Technology Services (LTTS) will announce its results on October 16.
Last week, Nasdaq composite gained 1.45% to close the week at 18,342.94. Global cues will also influence the movement of Nifty IT index this week (October 14-18).
