Stocks To Buy: 2 Large Nifty IT Stocks That Have Dropped Up To 46% From Highs

The Sensex and the Nifty hit a record high last week, on the back of heavy buying in banking stocks. IT Stocks on the other hand have been under pressure. Tech Mahindra and Wipro are two IT Stocks that have fallen significantly. Should you buy these largecap IT Stocks of the Nifty.

Wipro – Drop of 46% from 52-week highs

Shares of Wipro have been one of the worst performers from the Nifty space. The stock has fallen to levels of Rs 389 from a 52-week high of Rs 726, which is a drop of 46%. Some feel that the stock may have bottomed out and it maybe a good time to buy.

Ravi Singhal, CEO, GCL said earlier in a report in the Business Today, "IT stocks are the most impacted by the global scenario as high inflation and continuous rise in interest rates by global central banks can bring recession. This is affecting the IT stocks even as Nifty is trading at all time high. This is right time to invest in Wipro with long-term view target of Rs 550 and maintaining a stop loss of Rs 375."

JM Financials recently had a buy rating on Wipro, with a price target of Rs 480.

Tech Mahindra, down 44.44%

Tech Mahindra is another IT Stocks that is down close to 45%. The stock has dropped from 52-week high levels of Rs 1838 to levels of Rs 1021. Fears of recession in the US are weighing on sentiments in IT stocks. HCL Tech has already sounded a warning.

Sharekhan in a report in November said that it continues to prefer Tech Mahindra, given healthy deal wins and reasonable valuation. "We maintain a Buy rating on the stock with an unchanged price target of Rs. 1,220," the brokerage had said.

Sentiments adversely impacted for IT Stocks

The problem right now for ITS tocks is that many investors are making a switch from IT stocks to banking. There are growing fears that as interest rates in the US rise, there could be a recession. One of the biggest impact would be on the IT sector as investors cut spending. This has had a massive impact on the stocks of companies from the space. What could happen in the future is hard to say.

Disclaimer

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