IT stocks gain as rupee falls

The BSE IT index was up 0.9% on a day Sensex was down 1.6%

IT stocks gained about a per cent during Friday's trading session on the back of a falling rupee. The S&P BSE IT index was up 0.9% on a day when the Sensex was down 1.6%. The rupee hit an 11-month low at Rs 56.60 against the dollar.

Falling rupee helps boost revenue for IT companies who derive a majority of their business from overseas client, particularly the US and Europe.

Infosys was the top gainer in the index with the share moving up by 1.8%. Mphasis, which was the second highest gainer in the index, saw its share price gain in line with the Sensex at 1.6% despite poor quarterly performance. The company posted a 7% drop in its net profits on a year-on-year basis and a 4% drop on a quarter-on-quarter basis.

Espirito Santo Securities which downgraded the stock to neutral said that the stock was downgraded on the back of news that HP may sell its stake in the company. “We are downgrading our stance on MphasiS from Buy to NEUTRAL post the 31% run-up in the stock price over the last month,” the report said.

HCL Tech and TCS were the other stocks trading in the green, up 1.1% and 0.3%. Financial Technologies was the biggest laggard in the index, falling by about 1.5%.