IT stocks, which have faced pressure in the stock market in recent times, are now seeing continuous improvement. Especially after the release of quarterly results of companies, the interest of investors in the IT sector has increased.
Business News: Different trends were seen in the shares of IT sector in the Indian stock market on Friday. While Tech Mahindra shares registered a rise due to strong buying, shares of leading IT company Wipro witnessed a decline. Wipro’s weak quarterly results and management’s cautious commentary on future earnings added to investor concerns.
IT stocks, which have been under pressure for some time, are seeing improvement in recent times. After the quarterly results, there has been a positive trend in the shares of many major IT companies. However, investors’ stance remains varied depending on the companies’ performance and future outlook.
Why did Tech Mahindra shares rise?
The main reasons for the rise in Tech Mahindra’s shares are considered to be the company’s better quarterly performance and strong business signals. Brokerage firms have described Tech Mahindra’s recent quarterly results as better than expected. The company recorded better-than-expected revenue growth in the first quarter and has won several big deals. According to market experts, the company’s new deal win-win ratio, strong order book and expectations of future margin improvement have boosted investor confidence. Additionally, the company has retained its EBIT margin estimate for FY2027, sending a positive message to the market.
Why did Wipro shares fall?
In contrast, shares of Azim Premji-led IT company Wipro fell by nearly 3 per cent in early trade on Friday. The biggest reasons for pressure on Wipro’s shares were the company’s June quarter (Q1 FY26) results and weak revenue estimates for the September quarter. The company says that amid global economic uncertainties, customers remain cautious about their technology spending.
Companies are being cautious especially in non-essential digital investments. Investors are worried that this environment may impact Wipro’s growth in the coming quarters.
How were Wipro’s quarterly results?
Wipro recorded mixed performance in the April-June quarter. The company’s consolidated net profit stood at about ₹3,352 crore, which is about 0.6 percent higher than the same period last year. The company’s revenue increased to approximately ₹24,479 crore. However, the revenue figures fell short of market experts’ estimates.
The company has forecast limited growth or decline in IT services revenue for the September quarter. According to the company, revenue is expected to range from about a 1.5 percent decline to a 0.5 percent increase on a constant currency basis.
Concern increased due to cautious comment of management
Wipro management’s comments have also increased investors’ concern. The company said the demand environment remains broadly stable, but customers are focusing on reducing costs and reducing the number of suppliers. Many companies are reviewing their technology spending priorities and investing only on essential projects. This cautious attitude may have an impact on new deals and revenue growth of IT companies.
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