Nifty IT index crashes 8% on poor Q4 reports; Infosys share price tanks 11%, TCS, HCL Tech, Wipro in deep red
时间:2024-06-26 12:37:55 阅读(143)
As predictions of a disappointing Q4 for IT come to life, the Nifty IT index slipped more than 8% in trade today morning. After reporting sub-par quarterly earnings on Thursday, Infosys share price crashed up to 14.6% from Thursday’s closing price to touch an intraday low of Rs 1,185.3. TCS share prices extended losses for a second session after the IT giant’s net profit in the fourth quarter missed market estimates.
Despite only two IT heavyweights TCS and Infosys reporting numbers, traders on Dalal Street now expect the other IT majors’ earnings to be along the same dismal lines, as seen in the slipping share prices of Wipro, HCL Tech, and Tech Mahindra today. However, the entire IT index is trading with sharp cuts as well.
“The IT Services sector is expected to report moderated growth in Q4FY23 primarily on account of challenging times from world’s largest economies. IT automations in North America and Europe may show delayed spend or may face some spend cuts going ahead. We believe many of large enterprises will shift their focus on cost optimizations resulting in higher cost take out deals, vendor consolidation & lower discretionary spend. BFSI, Manufacturing, Telecom, Retail and Hi-tech verticals are expected to be impacted by the slowdown, thus weakening FY24E growth momentum outlook,” said Axis Securities in a report.
“A deteriorating global macroeconomic environment alongside possible recession in the US and Europe has dampened the near-term growth prospects of Indian IT companies. Enterprises have started to prune discretionary spends and shift focus to cost savings. Deal pipelines have not yet shrunk, but conversion to wins is taking longer. Recent guidance from global IT services companies points to a weak CY23 fronted by an anaemic Mar’23 quarter. Q3FY23 (Oct-Dec) earnings commentary from the Indian IT industry also indicates weakness over the next few quarters with a pickup in revenue growth only in H2FY24,” said BOB Capital Markets.
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