IT Stocks Gain After Infosys' Earnings Beat Estimates

IT stocks gained sharply on Friday following better than estimated numbers and a bonus share declaration from Infosys.

Infosys shares gained sharply over 7 per cent to hit a fresh 52-week high of Rs 3,908, while HCL Tech and Tech Mahindra were up over one per cent each. The CNX IT index, which tracks IT companies rose nearly 2.5 per cent.

India's Second largest outsourcer, Infosys reported a net profit of Rs 3,096 crore in the September quarter, beating street expectations. The company's board approved an interim dividend of Rs. 30 per share and a bonus issue of one equity share for every equity share held, leading to a sharp jump in its stock prices buying in other IT stocks as well.

Brokers polled by NDTV had seen Infosys' Q2 net profit at Rs. 2,959 crore. Sales rose to Rs. 13,342 in the September quarter against estimates of Rs. 13,318 crore. Infosys, which has been lagging behind the IT industry, had reported a net profit of Rs. 2,886 crore on sales of Rs. 12,770 crore in the June quarter.

The rupee which fell to a low of 61.35 per dollar on Friday against Thursday's close of 61.05 also stoked the sentiment for IT companies. Most of the earnings for IT companies come in dollar. So a higher dollar value against rupee is positive for IT companies. The rupee has appreciated over one per cent in last one month.

Infosys shares closed 6.6 per cent higher at Rs 3,889 a piece, HCL Tech ended up 2.5 per cent, while Tech Mahindra ended with marginal gains of 0.1 per cent,  outperforming the broader Nifty whiched closed 1.26 per cent lower.