The Nifty IT index surged 507.85 points to 35,689.10, marking a 1.44 per cent gain in afternoon trading on Monday, as investors responded positively to expectations of US rate cuts that could boost Indian technology stocks.
emerged as the top performer, jumping 4.74 per cent to ₹2,920.20, followed by Coforge which gained 2.60 per cent to ₹1,769.20. Persistent Systems advanced 2.27 per cent to ₹5,426, while rose 1.92 per cent to ₹8,452.50. The sector’s heavyweights also participated in the rally, with Infosys climbing 1.70 per cent to ₹1,494.60 and TCS gaining 1.13 per cent to ₹3,119.60.
Trading activity remained robust with the IT index recording a volume of 89.96 lakh shares worth ₹1,461.45 crore. dominated trading volumes with 25.56 lakh shares changing hands, generating a turnover of ₹382.42 crore, making it the most active stock by both volume and value.
Global brokerage CLSA provided the catalyst for today’s optimism, with its macro economist projecting 75 basis points of rate cuts in the US over the next 1-1.5 years. The firm expects this monetary easing could translate into a 10-15 per cent increase in valuation multiples for Indian IT companies. CLSA maintains an outperform rating on Persistent Systems and Tech Mahindra, while holding positive views on TCS, Infosys, HCL Technologies and Wipro.
The brokerage also anticipates a revival in discretionary demand across sectors including real estate, utilities, materials, staples and energy, which could benefit IT service providers. Despite today’s gains, the IT index remains under pressure year-to-date, down 17.68 per cent, as companies have grappled with weak demand from key markets amid global economic uncertainty.
The sector’s current price-to-earnings ratio stands at 25.41 times, while the price-to-book ratio is at 6.77 times. The index has traded between a 52-week low of 30,918.95 and a high of 46,088.90.