IT Stocks: 9 Top Dividend Stocks At New Highs, 14% Returns In 1 Day: HCL, Wipro, TECHM, TCS, LTIM In List

IT stocks were on the super roll, riding on the bulls and touching new 52-week highs. Nifty IT index alone skyrocketed by more than 1400 points or up to 4%. 9 out of 10 stocks listed on Nifty IT index had touched new peak levels. And all nine of them are best dividend paying stocks. 3 tech biggies HCL Tech, Wipro, and TCS have already announced new rewards for investors for the current fiscal. A staggering 2700% dividend payout is on the cards by the first week of February. IT stocks are broadly rising amidst their Q3 earnings.

Nifty IT index touched a new lifetime high of 37,929.30, rising by 1407.6 points or 3.8% in the day. The index is now moving closer to the 38,000 mark.

9 dividend-paying top IT stocks have given up to 14% returns in 1 day.

Wipro is the star performer of the day. The stock gained by 13.65% on January 15 by hitting a new 52-week high of Rs 529 apiece. Wipro has announced an interim dividend of Rs 1 per equity share and ADS for FY24.

Further, HCL Tech stock gained by 5.11% to a new 52-week high of Rs 1,619.60 apiece, and Tech Mahindra surged by 7.14% to hit a new 1-year high of Rs 1,401.50 apiece. Infosys and LTIMindtree also zoomed by 3.3% each to touch a new 52-week high of Rs 1,664.95 and Rs 6,442 apiece respectively.

Meanwhile, Coforge and Persistent Systems' share price rallied by 3% each to hit new 52-week highs of Rs 6,789 and Rs 7,880 apiece respectively. India's largest IT firm in terms of market share, TCS also zoomed over 2.1% to hit a new 1-year high of Rs 3,965 apiece. Lastly, L&T Technology Services share advanced by 1.8% to hit a new 1-year high of Rs 5,566 apiece.

HCL Tech has declared a fourth interim dividend of Rs 12 per share (600%), while TCS is set to pay a massive 2700% dividend amounting to Rs 27 per share for FY24 ahead. TCS and Wipro's dividend payout is in the initial days of February, while HCL's dividend payment is likely to be on January 31.

HCL Tech and TCS will trade ex-dividend this week, and Wipro will follow suit next week. Check Out Their Record Dates And Eligibility Criteria In the Article Link Below:

On the other hand, Mphasis was the only stock that did not cross its 52-week high levels. Although, Mphasis surged by 3.11% and hit an intraday high of Rs 2,762.85 apiece.

What do experts say about IT stocks?

Kaushik Dani Fund Manager - PMS, Abans Investment Managers said, "IT sector has begun the Q3 earnings season with better than expectations; whether it is on top line or EBIT margins front. This has helped markets to gain new all-time highs. Markets are likely to continue with upward momentum and near-term volatility on account of results season."

While Dhruv Mudaraddi, Research Analyst, Stoxbox explained that the current state of the Indian IT sector, as evidenced by the third-quarter earnings of the top four IT companies, reveals a challenging demand environment with cautious optimism for the future. The reduction in guidance for the fourth quarter is reflective of the average CC growth observed in the preceding three quarters.

Despite the muted outlook, Mudaraddi added, "There is a belief that deal momentum will strengthen in FY25, leading to improved revenue growth in high single digits in CC terms. The companies express confidence in their robust deal pipelines and bookings, anticipating an enhancement in client sentiment following positive remarks by the US Federal Reserve in December 2023."

He further said, "Margin outlook has improved due to effective cost-cutting measures, including reductions in employee and subcontracting costs. The companies are optimistic about a recovery in revenue growth, driven by the return of discretionary tech spending and the emergence of new technologies. They aim to return to their respective target operating margins by leveraging factors such as realization, pricing, productivity, utilization, and subcontracting optimization. With companies focusing on multi-year digital transformation projects, we expect a rise in IT services and end-user expenditure which presents an opportunity for higher growth in upcoming quarters. We, thus, advise investors to add large-cap IT companies at current valuations in a staggered manner, given the anticipated positive developments in the sector in FY25."

More dividend rewards from other IT companies can be expected as they present their Q3 numbers this month.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author or Greynium Information Technologies. The author, the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.