Where's the money in India IT now? Midcaps, not large, says J.P.Morgan

KPIT Technologies

04/04/2024 08:53

** J.P.Morgan sees mid-cap firms as money-making opportunity
in India's demand-starved IT sector over the short-term, with
overall recovery in sight only by H2 of CY2024
    ** Brokerage in an April 3 note upgrades LTIMindtree Ltd
 LTIM.NS  and KPIT Technologies Ltd  KPIE.NS  to "neutral" from
"underweight", Persistent Systems Ltd  PERS.NS  to "overweight"
from "neutral"
    ** LTIM's upgrade driven by its share price fall, while
brokerage sees better earnings for PERS and believes large deal
pipeline for KPIT can drive earnings growth in FY25 and FY26
    ** Adds, in short term, it prefers cos that provide
non-discretionary IT services, like Tata Consultancy Services
 TCS.NS , Mphasis  MBFL.NS  and HCLTech  HCLT.NS  over the likes
of Infosys  INFY.NS  and Wipro  WIPR.NS  which rely on
discretionary demand
    ** In the long-term, at least over the next year, JPM lists
INFY as its top pick in IT services and Cyient  CYIE.NS  among
engineering, research and development firms
    ** PERS up 1.4%, is the second-biggest pct gainer on Nifty
IT index that is up 0.7% on the day; stock also the
second-biggest YTD gainer on 10-member index which is down 0.7%
this year

 (Reporting by Nandan Mandayam in Bengaluru)
 ((Nandan.Mandayam@thomsonreuters.com; Mobile: +91 9591011727;))