Seven IT stocks rose by 0.12% to 4.22% at 14:01 IST on BSE as the rupee weakened against the dollar.
MphasiS (up 0.12%), Oracle Financial Services Software (up 0.45%), Infosys (up 0.49%), TCS (up 0.96%), Tech Mahindra (up 1.63%), HCL Technologies (up 3.06%), Wipro (up 4.22%) edged higher. HCL Infosystems declined 1.79%.
The S&P BSE IT index was up 1.31% at 7,758.11 and was the top gainer among the sectoral indices on BSE. It outperformed the S&P BSE Sensex, which was down 0.01% at 19,740.82.
The S&P BSE IT index underperformed the market over the past one month till 16 September 2013, rising 2.88% compared with the Sensex's 6.15% rise. The index, however, outperformed the market in past one quarter, advancing 27.78% as against Sensex's 2.94% rise.
The rupee weakened against the dollar today, 17 September 2013 ahead of the Federal Reserve's policy meeting, where it is widely expected to announce tapering of bond purchases. The partially convertible rupee was hovering at 63.06, weaker than its close of 62.83/84 on Monday, 16 September 2013. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.
HCL Technologies and HCL Infosystems on Monday, 16 September 2013, clarified that no proposal to merge HCL Infosystems or its systems integration and services business with HCL Technologies is under consideration. The two companies issued the clarification after media reports suggested that HCL Infosystems is working towards the goal of merging its system integration and services business with HCL Technologies. HCL Tech and HCL Infosystems have been teaming on specific opportunities in India and for this purpose the two companies have been cross selling each other's services over the last 2 years, HCL Tech said after trading hours on Monday, 16 September 2013. HCL Tech said that the company derived about 5% of its revenue from India during FY 2013. It is expected that the revenue from India during FY 2014 would remain at similar level, the company said. The arrangement with HCL Infosystems did not have any impact on the margins in the past and it is not expected to have any impact on the margins going forward, HCL Technologies said. HCL Technologies is a software firm.
HCL Infosystems also said that HCL Infosystems and HCL Technologies have been collaborating together under teaming agreements to address business opportunities in India. These agreements are on arms length basis in the best interest of HCL and its customers and not margin dilutive to HCL Infosystems, the company said.
A bulk of HCL Infosystems' revenues comes from selling computing hardware to government and by acting as a national distributor for mobile phones, computers, laptops and printers
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