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“I.T sector is one of fastest recovery from the initial fall from the initial fall.”

When we think of I,T sector In India we think of the City like Pune and Bengaluru which are also called as the silicon Valley of India but did you know that I,T sector begun in Mumbai 1967 Tata Group started their partnership with Burroghs( American Computing company which now specializes in software solutions to ATM and Self Services Kiosks)

Coming to now when when I,T industry contributes to 1.2% of India’s GDP with such a major share in India’s economy with current corona virus situation which has just increased the growth in the I,T sector with the most of the retailers and have gone online to sell their products online to combat the impact from the lock-down.

Even after the lock-down is over companies like TCS and other software companies plan on keeping their work from home model in place as it has proven be highly profitable as it reduces the overhead costs of rent and other infrastructure and residential costs which which will pave the way , along with the government ban on popular Chinese apps which will create a huge void in a market binging more opportunities for Indian companies and startups to fill in the ever growing demand of data and information.

Reliance Jio and Bolo India(A short video app) being one of the first companies to taking advantage of the growing Anti China sentiment making and scoring millions of downloads just in matter of few days.

As the data providers like Reliance Jio and Airtel are able to provide data for cheap rates it can be said more Indians are going to consume data and I.T sectors is only set to grow. According to some recent figures by NDTV as many as 50 Crore Indians have access to a smartphone.

When we talk about the market for the presence of software companies or tech companies in Capital Markets almost 4 of the top 10 companies of India are tech companies and software companies.

Some Of Our Recommendations For I.T Companies:-

Infosys

Company NamePrice to buyIndustry PEmarket cap in CrP/E
INFY951.9522₹406400.7623.75

Infosys is one of the largest tech companies in India which is currently listed on NYSE, NSE & BSE . Infosys includes various I.T based products with having a huge diversification including NIA a Ai platform , Infosys consulting services ,IIP a analytics platform, EdgeVerve systems which include a global banking platform and Panaya a cloud platform with other Engineering and digital marketing solutions which is management service along with assets in many major government based bonds and debentures.

Strengths

  • Infosys is a virtually debt free company.
  • Infosys has increasing revenue since last 3 years.
  • Company has tripled its cash flow from operations in last 10 years.
  • Company has a AAA rating and reaffirmed.

Weakness

  • Company has seen negative net cash flow in last 4 years.
  • Company has seen a decline in new account openings on steady deals platforms.

Opportunities

  • Mutual funds have increased their Holdings in Infosys.
  • Brokers have increased the target price for Infosys.

Threats

  • Covid-19 which has let to more employees waking remotely has increased risks of cyber security risks.
  • Net Income could decrease if government decreases the tax intensive.
  • Promoter holdings of company are very less 14 %.

HCL Technologies Ltd

Company NamePrice to buyIndustry PEmarket cap in CrP/E
HCLTECH694.422₹188,195.9115.56

H.C.L has several of G100 clients which are working in Life Sciences and Healthcare sector. H.C.L has been providing I.T support for companies which have been helping business providing them with remote work support with providing support of

With a market-cap of 188486 Cr H.C.L is the third largest I.T company in India in terms of market-cap. Company has shown strong growth in net sales with 8.6% YoY growth with having a overall OPM of 25.67%.

Strengths

  • H.C.L has signed 11 net new transformational deals, led by key
    industry verticals (including- telecommunication, financial services, life sciences and healthcare).
  • Company has a strong EBITA is at 25%.
  • Company has Low debt.

Weakness

  • Company has been trading at 3 times its book value.
  • Other liabilities have increased YoY.

Opportunities

  • Strong revenues and positive QoQ and YoY results constantly company has created a positive buying sentiment for the stock.
  • FII/FPI have increased their holdings in the stock.
  • Company is on 52 week high with increasing volume.
  • Company has strong cash flow from operations.

Threats

  • As company operates across various geographies where the exchange rates have been fairly stable but due to Covid-19 have brought uncertainty in the forex market which can be a cause of concern.

By admin

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