By Reuters | Updated: 12 January, 2024
BENGALURU, Jan 12 (Reuters) – Indian IT companies rallied more than 4% on Friday after market leaders Tata Consultancy Services (TCS.NS) and Infosys (INFY.NS) posted better-than-feared quarterly reports, easing some concerns about a sector grappling with fears of sluggish demand.
Shares of market leader TCS rose more than 4%, while No.2 Infosys jumped more than 6% after they reported bigger-than-expected revenue growth in the third quarter and indicated that the overall demand situation had not deteriorated further.
Infosys, too, said client behaviour was unchanged, after months of warning of that clients were either cancelling, postponing or reducing the size of contracts.
The Nifty IT index (.NIFTYIT) jumped 4.5% to a 21-month high. Wipro (WIPR.NS) and HCLTech (HCLT.NS), due to report results later in the day, were up about 4% and 3%, respectively.
“The results at Infosys and TCS came in a lot better than initially feared by the Street,” said Apurva Prasad, vice president of institutional research at HDFC Securities.
“With the trajectory of worst (in demand) bottoming out, and a ramp up in major deals, TCS and Infosys’ exit for the fiscal year could look better.”
Infosys’ shares rose 6.7% to their highest since March 2022, and were set for their best day since July 2020. TCS shares were last up 3.8%.
At least 10 analysts upgraded their rating on Infosys’ stock, while eight upgraded their rating on TCS, according to LSEG data.
© Thomson Reuters 2024
