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Sunny Agrawal, Head of Fundamental Equity Research, SBI Cap Securities, says the IT sector is expected to perform well, driven by reduced uncertainty due to potential trade deals and strong BFSI growth. Accenture’s impressive numbers signal that the worst is over. HCL Tech and Tech Mahindra are poised to outperform, while Coforge and Firstsource are promising mid-sized players with strong growth potential. What are you making of the market move given that we have seen a spike up in gold, but it is not a flare up. Also other than that, gold has softened, while one would expect an opposite reaction given the geopolitical backdrop right now. Sunny Agrawal: The uncertainty pertaining to the tension between Iran, Israel, and the US seems to be weaning off. The reason being that the motto of the US and Israel was to stop Iran from pursuing their nuclear ambition. Since most of their facilities have already been damaged by the US and the US has gone on record saying that unless and until Iran retaliates significantly, they are not very keen on further attacks on Iran. So, this event is already being discounted by the market and in case there is no further major escalation between Iran, Israel, and the US and US backs off from all this chaos, we feel that the uncertainty is behind us for both equity markets as well as precious metals like gold. So that may be one of the reasons that gold is trading soft in the trade today. Coming to the equity market, again, we believe that the market continues to remain a buy-on-dip kind of market wherein any dip due to this ongoing geopolitical tension should be taken as an opportunity to accumulate quality stocks across rate sensitive sectors such as NBFCs, real estate, and the automobile sector. What is your take on IT? We have seen a big trigger coming in in terms of Accenture numbers and we have seen the ripple effect on Indian IT. IT as a pack has been surging since a couple of trading weeks. We have seen sector churn positively impacting IT. Now with this downfall that we have seen, is this the beginning of the correction for it or is today just a one-off on the back of this Accenture news flow?Sunny Agrawal: Coming to IT, if you take a step back, during the March quarter results commentary, we have seen that most of the management were not very clear in terms of the growth outlook because of the uncertainty pertaining to trade war or geopolitical tension. But now with a trade deal between US-China or for that matter any other countries are on the anvil, we believe that the uncertainty has reduced significantly and that has been backed by the strong set of numbers by Accenture, especially for BFSI as a sector. Live EventsYou Might Also Like:$40 billion consumption boom coming soon! Is your stock portfolio ready to ride it?There we have seen a 13% growth which contributes the majority of the revenue for frontline IT companies based out of India. So, at least the worst is behind us as far as the IT sector is concerned. So, based on the commentary of management on the demand environment in upcoming result season, the stock selectively should start outperforming the larger pack. If I have to choose a few of the names among the IT pack, the few socks which are on our radar among the front line is HCL Tech. We feel that HCL Tech can outperform its peers. In Tech Mahindra, we can see a continuous improvement in terms of numbers so that is a kind of turnaround story as far as the frontline IT pack is concerned. Among the mid-sized players, we like Coforge, backed by very strong recent deal wins. Another stock we like is likely to post double-digit growth is Firstsource Limited.(You can now subscribe to our ETMarkets WhatsApp channel)
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(You can now subscribe to our ETMarkets WhatsApp channel)Read More News oncoforgehcl techtech mahindraIT sector performanceSunny AgrawalAccenture growthHCL Tech stockBFSI sector growthCoforge midcap stocksTech Mahindra stock outlook(What’s moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price…moreless
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