8,597.75316.65
Stock Analysis, IPO, Mutual Funds, Bonds & More

Why Sudip Bandyopadhyay is cautious on IT stocks

Whenever there are elections in the US, there are all kinds of statements being made, which hurt the sentiment of technology outsourcing, says the group chairman of Inditrade Capital.

ET Now|
Last Updated: Feb 25, 2020, 06.11 PM IST
0Comments
Sudip Bandyopadhyay, Inditrade Capital-1200
From medium- to long-term perspective, the future looks good for large as well as some of the midcap IT companies
For IndiGo, again those related-party transactions are in focus. Sebi has found some undisclosed transactions in its prelim enquiry and this was of course what led to all that contention between the co-founders and the stock is reacting on that news again. So despite strong earnings, constant reassurances and the fact that they are keeping the ship steady, this does not seem to be completely going away.
Well, it is unfortunate. The way things were panning out, I think this allegation was kind of behind them before this news report came out. I will not put too much merit behind this yet. Let us see how the company responds and let us see what the report is. It is too premature to comment on the report. Having said that, as far as the stock is concerned, if you are looking at the airline space, you have very little options. IndiGo definitely as you mentioned has been running a tight ship. They have been kind of doing all the right things and the way global oil prices are shaping up, as things stand today, I think aviation fuel prices are not going to go up in a hurry and that is definitely good news for a company like IndiGo. Under these circumstances, if you leave aside this Sebi comment, IndiGo looks good at current levels. Maybe this dip on account of this Sebi news is an opportunity for an aggressive investor to accumulate.

IT has really made a comeback because of the dollar-rupee parity.
You are absolutely right. I think whenever there is uncertainty in the global markets, a couple of things happen. One is that gold prices shoot up, which has happened. The other thing, which normally happens is technology stocks start moving up and that is again playing out. I will be a bit cautious as far as technology is concerned. Remember, we are having US elections towards the end of this calendar year and whenever there are elections in the US, there are all kinds of statements being made — be it by political parties or presidential candidates. This kind of hurts the sentiment as far as technology outsourcing is concerned. So, I will be a little cautious on IT this calendar year. But overall, if you are talking about medium- to long-term, I think the future looks good as far as large Indian IT companies and even some of the midcap IT companies are concerned. So, if you are talking about TCS, you are talking about Infosys. I think if you have a one-year time horizon, there is absolutely no problem in buying those.

Also Read

Stock market update: 127 stocks hit 52-week lows on NSE

Trending stocks: Fortis Healthcare stock up 0.24%

Trending stocks: Bharti Airtel stock price down 1%

Trending stocks: Eicher Motors stock price down 1%

Stock market update: 188 stocks hit 52-week lows on NSE

Comments
Add Your Comments
Commenting feature is disabled in your country/region.

Other useful Links


Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service