IT Stocks
Outlook for the week – 27 to 30.01.2015
( www.rupeedesk.in )
Stocks of information technology
companies are expected to take cues from US President Barack
Obama's visit to India and his
comments on H1B and L1 visas. H1B visa allows US companies
to employ foreign professionals
and L1 lets international company temporarily transfer an
employee to a parent branch or a
subsidiary in the US.
Given that Indian IT companies,
especially giants like Tata Consultancy Services and Infosys are
the highest users of these visas,
Obama's comment on the issue holds significance for the sector.
This week, two major mid cap IT
companies announced their third quarter earnings. On Monday,
Mindtree posted a 2.5% sequential
growth in net profit to 1.40 bln rupees for the Oct-Dec
quarter, just above estimate
which pegged the net profit at 1.36 bln rupees.
On Wednesday, Pune-based KPIT
Technologies reported a net profit of 653 mln rupees, up 7.5%
from a year ago, and revenue of
7.80 bln rupees, up 15%. On a sequential basis, the Pune-based
company's revenue during the
quarter was up 2.96% in rupee terms, largely in line with other IT
companies' earnings reported so
far. Next week, investors will monitor Persistent Systems as the
board of the company will
consider its third quarter results in a two-day meeting between Jan 23-
24.
Towards the end of the week, IT
stocks will react to the earnings of Tech Mahindra and HCL
Technologies, both scheduled for
Jan 30. While investors will continue to watch the movement
of the rupee against the dollar,
only significant movement on either side will cause the IT stocks to move.
