IT stocks outperformed all other groups of stocks on the BSE Tuesday tracking strong gains in Cognizant Technology Solutions, which surprised the Street with a strong performance in the June quarter.
Cognizant's shares rose as much as 13 percent to $65.48 on Monday on the Nasdaq.
The New Jersey-based company, most of whose employees are in India, stood by its full-year revenue forecast at a time when its Indian peers have been painting a gloomy picture for the rest of the year on slowing global outsourcing spending.
Cognizant, which also competes with Accenture Plc and Computer Sciences Corp, said growth returned to some of its largest banking clients in the quarter. It counts JPMorgan Chase & Co, Rabobank and UBS AG among its core banking clients.
That is good news for TCS and Infosys, both of which earn a large chunk of their revenue from the banking, financial services and insurance (BFSI) vertical.
TCS, which has maintained that it would grow at more than 14 per cent in fiscal 2012-13, was the top gainer among frontline IT stocks. It gained nearly 3 per cent at Rs 1,265.
Infosys, which has disappointed the markets with a below average projection of 5 per cent revenue growth, also traded with 2 per cent gains. Analysts said Infosys is attractively valued, having fallen over nearly 20 per cent in the last six months.
(With inputs from Thomson Reuters)
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