IT Stocks Outlook for the week – 08 to 12.08.2016
Seen weak as Cognizant cuts 2016 sales guidance
( www.rupeedesk.in )
Stocks of information technology companies are seen trading
in a range with a negative bias next week, as Cognizant Technology Solutions Corp's weak sales
growth guidance for 2016 is seen
weighing on the sector. The US-based IT major cut its sales
growth guidance for 2016 to $13.47 bln-
$13.60 bln from $13.65 bln-$14.00 bln earlier. Back home,
earlier this week, HCL Technologies
surprised the market with strong Apr-Jun earnings. The
Delhi-based company reported a consolidated net profit of 20.5 bln rupees for Apr-Jun, up
5.9% on quarter. Revenue from operations were at 113.4 bln rupees, up 5.9%.
Tech Mahindra, which detailed its earnings on Monday,
reported a consolidated net profit of 7.96 bln
rupees, down 9.5% on quarter and income from operations of
69.2 bln rupees, up 0.5%. Analysts,
however, believe investors may are likely to invest in the stock
due to low valuations. Analysts
recommend investing in stocks of midcap companies, which are
likely to be less risky than frontline
companies. The Indian currency is likely to trade weak
against the US dollar, which rose following
robust US July payroll data. The Indian unit ended at 66.77
rupees to a dollar yesterday.