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Stocks of information technology companies are seen trading in a thin band next week as investors will await Jan-Mar earnings that kick start with Infosys on Apr 12. We expect muted March quarter results due to seasonality (as clients freeze and allocate annual budgets), dollar and rupee appreciation against pound sterling, and company specific issues. We do not expect Infosys to miss its annual revenue guidance, but said revenue guidance for the current financial year and commentary on key metrics such as client budgets, pricing, and volume growth will be closely watched. While detailing its Oct-Dec earnings in January, Infosys had guided for consolidated net sales of at least $7.45 bln for 2012-13, up from $7.34 bln guided in Jul-Sep. Infosys' guidance is likely to be centre of attention yet again, with the key debate whether it would guide or not. We expect its FY14 revenue guidance to be at least 12% growth (including Lodestone) and rupee-EPS guidance at 175 rupees. Market participants believe that recovery in technology spends will remain key to further outperformance in technology stocks. We see large-cap companies as preferred bets as it expects growth recovery in 2013.
