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Informist, Friday, Jan. 10, 2024

MUMBAI – Shares of information technology companies are expected to be range-bound next week, as major players such as Infosys, Tech Mahindra, and Wipro are expected to report flat growth in sales for the Oct-Dec quarter, according to analysts. This is despite IT major Tata Consultancy Services giving a positive commentary on discretionary spending in 2025, after reporting a mixed performance for the December quarter.

Shares of IT companies are expected to be range-bound for some time as markets will look for commentary from those scheduled to announce their results next week, an analyst with a domestic broking firm said. Further, as the budget cycles are decided in the US, IT stocks might see a positive run-up if there is positive commentary from companies, the analyst added. 

Shares of HCL technologies are seen up 2.0-2.5% in the initial days of next week, on the back of the positive results expected for the quarter, Rishubh Vasa, research analyst at Indsec Securities and Finance Ltd., said. The IT index is expected to perform well during the week with major IT companies like Infosys announcing its results, the positive results expected from mid-cap IT companies, and the expected ratings upgrades, Vasa said.

TCS announced its results post market hours Thursday. The company reported a consolidated net profit of INR 123.80 billion for the December quarter, on revenue of INR 639.73 billion. The bottom line grew 4% sequentially, while its top line declined nearly 0.5% sequentially.

Major companies from the Nifty IT index, such as Infosys, HCL Technologies, Tech Mahindra, Wipro and LTIMindtree will announce their results for the December quarter next week. HCL Technologies is likely to outperform its peers with a sales growth of 4%, but the sales growth is seen flat for Infosys, Tech Mahindra, and Wipro. 

The Nifty IT index closed 2% higher at 44609.50 points this week. Of the 10 constituents in the index, eight gained over the week, barring Coforge and Persistent Systems. LTIMindtree and TCS were amongst the top gainers of the index. Next week, support for the index is seen at 43312.70 points and resistance at 45447 points.

TOP HEADLINES

* Analyst Concall: Tata Elxsi says FY25 to be soft; recovery seen from Apr-Jun
* Analyst Concall: BSNL deal 70% complete, to taper off in Jan-Mar - TCS mgmt
* Seasonality, soft demand marred on-qtr revenue growth Oct-Dec, says TCS mgmt
* Earnings Review: Tata Elxsi Dec quarter net falls most in 17 quarters
* Earnings Review: TCS sales down for 1st time in 18 qtrs, PAT up after 2 qtrs
* Persistent Systems launches AI-powered knowledge graph tool Pi-OmniKG
* Newgen Software US arm gets contract of $2.58 mln from healthcare client
* IPO Alert: Mouri Tech withdraws draft papers filed with SEBI
* Earnings Outlook: Furloughs may cap TCS sales; rupee's fall to boost margins
* Earnings Outlook: Seasonality may shore up HCL Tech sales, margin growth QoQ
* Birlasoft's Roopinder Singh resigns as CEO of Americas
* Tata Technologies in pact with Telechips to develop software-defined vehicles
* Microsoft to invest $3 bln in India for cloud, AI infra over next two years
* Tata Elxsi in MoU with National Aerospace Labs for advanced air mobility
* Birlasoft recognised as supplier on UK government's G-Cloud 14 framework
* SMALLCAP World Fund sells 2% stake in Tanla Platforms; stake now at 3.3%
* Persistent Systems to buy some assets of Soho Dragon for $5.94 mln
* Meta Platforms challenges CCI INR-2-bln fine in privacy policy case in NCLAT
* Supreme Court transfers Amazon, Flipkart antitrust cases to Karnataka HC
* Fire breaks out in control room at Tata Elxsi's premise at Trivandrum
* FSN E-Comm sees Oct-Dec consol net sales growing higher than mid-twenties
* Tata Elxsi, Qualcomm Tech join hands to make platform for automakers
* Govt releases draft rules for Digital Personal Data Protection Act

Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:

End

Reported by Arya S. Biju

Edited by Ashish Shirke

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