Nifty IT index hits record high; Infosys, TCS, HCL Tech gain over 2%

Thus far in the month of July, the Nifty IT index has outperformed the market by surging 19 per cent as against Nifty 50 index which was up 8.25 per cent during the same period

Shares of information technologies (IT) companies continued their upward movement on Monday with Nifty IT index hitting a fresh record high on the National Stock Exchange (NSE), gaining 2 per cent in an otherwise weak market.

Tata Consultancy Services (TCS), Infosys, HCL Technologies, Mindtree and Tech Mahindra were up 2 per cent each, while Mphasis, NIIT Technologies and Larsen & Toubro Infotech were up in the range of 3 per cent to 8 per cent.

At 12:24 pm, Nifty IT index, the top gainer among key sectoral indices, was up 2 per cent as compared to 0.37 per cent decline in the Nifty50 index. The IT index hit an intra-day high of 17,643.90, surpassing its previous high of 17,514.05 touched on July 21, 2020.

Thus far in the month of July, the Nifty IT index has outperformed the market by surging 19 per cent after sector majors Infosys, HCL Technologies and Wipro reported better-than-expected April-June quarter (Q1FY21) earnings. In comparison, the Nifty 50 index was up 8.25 per cent during the same period.

Mphasis, the top gainer among Nifty IT pack, rallied 8 per cent and hit a fresh 52-week high at Rs 1,208 in intra-day trade. In the past two trading days, the stock has surged 23 per cent after the company’s Q1FY21 earnings came in-line with Street estimates. Besides, the company signed a new deal worth $216 million deal in July 2020 in addition to the Q1 TCV declared wins worth $259 million, which further boosted sentiment.

“The company has won new TCV (total contract value) of $259 million (includes one large deal of over $100 million) in Q1FY21, which will drive revenues and margins in coming quarters. Also, the company has limited exposure to impacted verticals, which is a key positive,” ICICI Securities said in a note.

That apart, HCL Technologies hit a fresh record high of Rs 696.85, up 3 per cent in the intra-day trade. In the past six trading days, the stock has soared 12 per cent after the company reported 11 large transformational deals in the April-June quarter and said that the pipeline remains solid (+40 per cent QoQ), lending visibility to revenue recovery as indicated by the formal revenue outlook.

Meanwhile, Infosys was up 2 per cent to Rs 944 and trading close to its all-time high level of Rs 955.50 touched on July 16, 2020. According to regulatory documents, the family members of Infosys co-founder SD Shibulal have sold 8.5 million shares of the company worth Rs 777 crore via open market. The name of the buyers were not ascertain immediately. CLICK HERE TO READ FULL REPORT