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With less than two weeks before IT major Infosys comes up with its quarterly performance, India's equity fund managers are cautious while taking a further buy call on the sector.
Already, they have pumped in a little over 14% of equity assets in stocks of Information Technology companies. But now they are either slightly pruning their investments in some of the IT names, in particular Infosys; or they are adopting a wait and watch policy before taking a further trade call on the sector.
Fund managers' tilt towards export-oriented sectors have neared their several years high. IT, in particular, has been witnessing a continuous buying. Rather, the money which has been chasing banking shares is now being deployed in IT stocks.
Those visibility in IT sector is far more robust than any other sector at present, and possibility of re-rating is not being ruled out; fund managers say that for the time being they would see how quarterly performances turn out to be.
Their cautious stand comes from the fact that last year during the same time, IT had been throwing surprises (negative as well as positive) for fund managers at one point of time there was almost an unanimous view of shunning IT space. However, within a matter of a quarter perspective took a 180 degree turn and all turned bullish on the IT counters.
The buy call worked well for the fund managers. But in case, something untoward incident happens, heavy exposure to IT stocks may prove fatal for the investment managers.
In comparison to Infosys, they are more comfortable with its peers - Wipro, HCL Tech and TCS.
