IT Stocks Outlook for the week (18-22.06.2012)
rupeedesk
RUPEE DESK: IT Stocks Outlook for the week (18-22.06.2012)
Stocks of major information technology companies may take cues from global developments next week, such as outcome of elections in Greece, the Group of 20 nations' summit, and US Federal Open Market Committee meet. Greece elections will be held over the weekend. Most Indian IT companies get nearly 85% of their revenue from the US and UK.
The IT sector is directly linked to global markets and
investors will take cues from what is happening there. Any good news on the
global front may lead to a rally in IT stocks. Movement in stocks of IT
companies may also be linked to the broad market next week due to the lack of
any sector-specific triggers. The broad market will take cues from the Reserve
Bank of India's
mid-quarter review of monetary policy on Monday. The RBI is widely expected to
cut repo rate by 25 basis points to 7.75%. Some also expect the RBI to cut cash
reserve ratio along with repo rate.
Stocks of Tech Mahindra and Satyam Computer may continue with the positive movement. On Mar 21, the respective boards of Tech Mahindra and Satyam Computer had approved the merger with shareholders of the Hyderabad-based company getting two Tech Mahindra shares for every 17 held. The merger will be effective from Apr 1, 2011.
On a pro-forma basis, the Mahindra Group will own 26.3% in the merged entity, Tech Mahindra's largest client BT will hold 12.8%, and 10.4% will be held as treasury stock, the company had said at the time of announcement of the merger