Infosys, Tech Mahindra Gets Yes Securities ‘Buy’ On Sector Initiation; Stocks Remains Top Pick Yes Securities NDTV Profit

The brokerage don’t see Indian IT breaking away from structurally declining margins since FY14. Therefore, players with pricing power like Infosys and significant margin headroom like Tech Mahindra are top picks. Against this backdrop, NIFTY-IT’s ~31% correction from its Dec-24 peak offers good entry points.

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. 

Yes Securities Report

We initiate coverage on the Indian IT sector with a differentiated deep-dive into the US client base of large-cap players, offering sharper visibility into sectoral drivers beyond management commentary.

Our analysis highlights downside risks to consensus BFSI growth assumptions, a more constructive stance on retail, and steady outlook for relecom and Hi-Tech.

While deal momentum remains healthy across tier1s, our revenue conversion metric shows momentum for Wipro and LTIMindtree, is steady for Infosys, and weak for HCLTech and Tech Mahindra.

We don’t see Indian IT breaking away from structurally declining margins since FY14. Therefore, players with pricing power like Infosys and significant margin headroom like Tech Mahindra are our top picks. Against this backdrop, NIFTY-IT’s ~31% correction from its Dec-24 peak offers good entry points.

We prefer Infosys for its GenAI leadership and solid execution, and Tech Mahindra for margin recovery and recent deal wins, while we are Neutral on HCLTech and LTIMindtree due to valuation and margin decline; Add rated Wipro offers near term revenue momentum.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

. Read more on Research Reports by NDTV Profit.Yes Securities stays Neutral on HCLTech and LTIMindtree due to valuation and margin decline.  Read MoreResearch Reports, Markets, Business ​NDTV Profit