On Wednesday, Nifty IT and the S&P BSE IT indices hit fresh highs as tech stocks extended their rally and hit new all-time highs amid hopes of more large deal wins.
Nifty IT hit 24,020.55 during the day while BSE IT index touched 46,265.44.
Shares of the Tata Consultancy Services (TCS), Infosys, HCL Technologies, Tech Mahindra, Larsen & Toubro (L&T) Infotech and MphasiS, which are all part of the Nifty IT index hit their respective fresh record highs. Non-index stocks Birlasoft and Persistent Systems also hit new highs on Wednesday.'
Among tech stocks, Wipro was the biggest gainer, climbing 4% to Rs 378.65, after the company announced a significant strategic digital and IT partnership deal with METRO AG. Shares of the IT giant that is set to open its Rs 9,500 crore share buyback on 29 December edged close to its record high of Rs 382.
Infosys was up 2% at Rs 1,249, up 6% in the past two trading days after the company said it has won a multi-year deal from German automotive major Daimler to drive hybrid-cloud powered innovation and IT infrastructure transformation.
Brokerages are also bullish on the sector as they see this year as an opportunity for newer and bigger deals for Indian tech companies, especially those involved in outsourcing business.
Motilal Oswal Securities said in its sector update that Indian IT companies have been presented with an opportunity to increase their penetration in Continental Europe, which has historically lagged the US in outsourcing adoption.
Goldman Sachs believes that India is entering the third phase of outsourcing, which could lead to double-digit growth in the coming financial years. It has projected an average of 13.1% dollar revenue growth in the financial year 2021-22.