Thus far in the calendar year 2023 (CY23), the stock price of Cyient has zoomed 74 per cent, as against 2.5 per cent rise in the S&P BSE Sensex.
Stellar long-term track record, growing digitalisation augur well for IT sector funds
Despite the ongoing selloff and the global macroeconomic stress, analysts say that the IT sector still remains a preferred bet from a long-term perspective
Select mid-cap IT stocks may surge up to 10 per cent on short-term rebound
While the overall growth outlook is positive, there are headwinds for margins and valuations are at premium to large-cap IT firms
Mindtree is the top performer among IT firms for the month with returns of 27.2 per cent, followed by Nelco and Tech Mahindra
Their m-cap is up 5% this month, against 11% rise in large-cap IT stocks
Unlike the top four or five IT players, when it comes to the mid-cap IT services players, every company has a different strategy and focus segments
Sharp premium over larger peers and ability to maintain margins can cap gains
The Nifty IT index has managed to conquer the resistance of 27,500 which suggests a further upside towards 28,200 and 28,500 levels
These five stocks are likely to gain ground in the days ahead, provided the overall market sentiment stays strong.
They also remain optimistic on the road ahead for the IT sector given the sharp fall in rupee's value against the US dollar.
Going by the analysts' view, the IT sector, as a whole, faces four major challenges.
The bigger investment argument for the mid-cap IT firms is the change in demand environment, which is reflected in deal pipelines, the higher share of digital revenues and size of the contracts