IT Stocks Outlook for the week – 02 to 06.11.2015
Range-bound
next week; Tech Mahindra may lend cues
Stocks
of information technology companies are seen trading range-bound next week
ahead
of Tech Mahindra Ltd's Jul-Sep earnings, which may lend some cues to the
sector.
After
disappointing performance or guidance by its peers, analysts are hopeful that
Tech
Mahindra
will surprise the market with strong Jul-Sep performance. The city-based firm,
which
will detail its Jul-Sep earnings on Tuesday, is likely to post 8% sequential
rise in
consolidated
net profit at 7.3 bln rupees and 4% rise in consolidated revenue to 65.7 bln
rupees.
Tech Mahindra will be last of the large-cap information technology companies to
detail
earnings for Jul-Sep. If it disappoints the market, then the information
technology
segment
is seen weak in the upcoming sessions, but if the company posts strong
performance
on Tuesday, then improvement in the sector is likely.
The
strengthening of the rupee against the US dollar is also weighing on the
sector. The
rupee,
which ended at 65.2650 against the dollar Friday, is expected to trade in the
range
of
64.90-65.30 per dollar. HCL Technologies had also disappointed the market.
However,
views
on the company improved slightly when it announced the acquisition of US-based
company
Power Objects for $46 mln in the week. Market participants are looking
forward
to more announcements from the company. IT giants Infosys Ltd and Tata
Consultancy
Services Ltd too had failed to impress the market with Jul-Sep earnings.
Meanwhile,
the focus has shifted to mid-cap companies. Mind tree Ltd is one of the most
preferred
stocks among the mid-cap companies. During the week, Persistent Systems Ltd
reported
6.9% sequential rise in consolidated net profit for Jul-Sep to 718.5 mln rupees
and an 8.5% sequential
rise in consolidated revenue to 5.4 bln rupees.