IT shares extend gains; TCS, Infosys hit new highs

Shares of information technology (IT) companies were trading higher for the third straight day due to persisting weakness in the rupee. The rupee hit an all-time low of 70.08 against US dollar on Tuesday.

Tata Consultancy Services (TCS), Infosys, NIIT Technologies and Infibeam Incorporation from the IT index hitting their respective new highs on the National Stock Exchange (NSE) in intra-day trade today.

Intellect Design Arena, Persistent Systems, Mindtree, Tech Mahindra, Cyient, KPIT Technologies and L&T Technology Services were up in the range of 2% to 4%. A cheaper rupee bodes well for Indian IT companies, as they derive a huge share of their revenues from exports.

Nifty IT index, the largest gainer among sectoral indices, was up 1.3% at 15,074 at 11:21 am; as compared to 0.47% rise in the Nifty 50 index at 11,409 points. The IT index hit a new high of 15,078 in intra-day trade today, gaining 3.3% in past three trading sessions, against 0.54% decline in the benchmark index.

TCS hit a new high of Rs 2,022, up 1% on the BSE in intra-day trade today. The stock of the country’s largest IT services provider turned ex-date for the proposed buyback today. The Company has fixed Saturday, August 18, 2018 as the record date for the purpose of determining the entitlement and the names of the equity shareholders who shall be eligible to participate in the buyback offer of the Company.

Since June 11, 2018, TCS rallied 16% after the company said its board will consider a proposal for buyback of equity shares of the Company, at its meeting to be held on June 15, 2018. The board approved a proposal to buy back up to 76 million equity shares worth about Rs 160 billion. The buyback price has been fixed at Rs 2,100 a share, a 15% premium over its prevailing market price.

Thus far in the calendar year 2018, Nifty IT index surged 29%, as compared to 8.3% rise in the Nifty 50 index.

The Indian rupee hit the 70-per dollar mark for the first time, tumbling to a record low, as a Turkey-led rout in emerging-market currencies intensified losses. The rupee slipped as much as 0.2% to 70.08 per dollar in Mumbai and is down almost 9% this year in Asia’s worst performance. CLICK HERE TO READ FULL REPORT