L&T Infotech, Cyient: Are mid-tier IT companies a good bet post Q1 numbers?

Going by the analysts' view, the IT sector, as a whole, faces four major challenges.

Most mid-tier IT companies have put up a dismal performance in the first quarter of the financial year 2019-20 (Q1FY20), nudging brokerages to not only slash target prices for stocks, but also downgrade their ratings. 

While the street had factored in margin pressure owing to rupee appreciation, wage hikes and visa costs, the extremely weak numbers from names such as Cyient and Mindtree have taken market participants by surprise. Even the stronger names, such as L&T Technology Services and L&T Infotech, have posted subdued numbers due to weakness in some of its segments. Mastek, too, had a tepid quarter. NIIT