Nifty IT index jumps 2.5%; TCS, Tech Mahindra, HCL Tech, Infosys gain

Nifty IT index, BSE IT Index, Infosys, HCL Tech, TCS, Tech Mahindra, Wipro: IT stocks extended gains for the third consecutive trading session on Thursday, December 1. The Nifty IT Index jumped over 2.5 per cent to 31,156.65 levels and BSE Information Technology index was up over 2 per cent to 31,165.88 levels intraday, aiding most to the benchmark indices.

IT heavyweights such as Tech Mahindra, TCS, HCL Tech, Wipro, and Infosys are among the top Nifty and Sensex gainers, each up between 1 and 2.5 per cent.

From broader markets, L&T Technology Services, Mphasis and Persistent have surged between 5-7.5 per cent, while LTI and Coforge were up between 3 and 3.5 per cent on the NSE. Other Tier II IT stocks such as Subex, Ramco Systems, Mastek, Birlasoft, Nelco, Happiest Minds, Zensar Tech gained between 3 and 7 per cent.

According to Jefferies report, the top 5 Indian IT firms have witnessed a strong growth acceleration from 9 per cent Year-on-Year (YoY) in constant currency terms over FY20-22 to 17 per cent YoY in CC terms during the first half of the current fiscal (FY23).

The acceleration in growth has been led by Manufacturing, Communications, Retail and Hi-tech verticals that form 48 per cent of the top 5 IT firms' revenues, Akshat Agarwal, Research Analyst at Jeffries, a global brokerage firm, said in a report.

Similarly, Sushil Sharma, Research Analyst at Edelweiss Research said, “We are continuing with a view that there is near-term trading upside but the medium-term view is uncertain as it is too early to disregard macro-induced demand.”

He added therefore we continue with a view that there is a near-term trading upside and to build position gradually with an option to consider buying aggressively. The brokerage continues to prefer large-caps/larger-midcaps with top picks such as Infosys, LTI, Persistent, and LTTS.