Infosys and Tata Consultancy Services were down a huge 7 per cent, while Wipro slid 5.50 per cent. HCL Tech was down 7 per cent, while Tech Mahindra was down 2 per cent. The rout spread to mid sized IT companies with Persistent falling 7 per cent and NIIT Tech down 8 per cent and Mind tree too dropping more than 4 per cent.
The rupee hit a high of 58.41 against the dollar as against a close of 58.79 against the dollar on Friday, a day the election results were announced.
There is a possibility that the rupee would appreciate even further given the strong government that is set to take shape at the centre. This is unlikely to augur well for software stocks, as companies could take a hit on their rupee revenues and margins should the rupee appreciate even further.
Some of the software companies have shown muted growth for Q4 201 and a further appreciation in the rupee is set to hit their prospects even further.
Also, investors are resorting to a portfolio shift by selling IT stocks and buying into infra, capital goods and banking stocks.