Order intake, however, increased by more than 70 per cent over the last year and touched 3 million (about Rs 2,536 crore). Even on the bourses since the rupee;s fall started from August 2011, the BSE-IT index has gained 10 per cent while the broader markets have been down around 5 per cent. However, experts are advising investors to wait for a better entry to the stock. Had the dollar not risen, the growth would have come down to 23 per cent. Now, the sector;s saving grace, quite unlike that of the economy, is the plunging rupee." Infosys share price (Rs 2. Further, as currency depreciation will lead to higher inflation there may be rise in input غير مجاز مي باشدts with higher salary hikes in the medium term. If, in large-caps, Infosys looks good, the mid-cap space is more lucrative. Revenues of Wipro and Infosys grew 13 and 15 per cent, respectively, in dollar terms; in rupee terms they were up 21 per cent and 22 per cent.

The company has consistently underperformed its peers in terms of growth." Outlook Money had picked two-NIIT and Zylog Systems. Nevertheless, hope still springs eternal. All this will, over time, alter the pricing dynamics in the sector and, hence, gradually the benefits of currency depreciation will dissipate. Moreover, the rupee has only fallen by 6 per cent against the euro. While TCS has said the BSFI sector has bottomed out, for others it;s still an evolving situation. As a result, forex losses on account of hedging at lower levels would take away some of the sheen from the reported results. And the intensifying uncertain macro-environment globally and sluggish European economies have made clients cautious about their IT budgets. Operationally, the BFSI vertical has been one of the earliest adaptors of technology and makes up the largest segment for IT companies. Says Shah, "Infosys is trading at 14 times its financial year 2013 earnings, the lowest seen in recent years.

Wipro share price (Rs 400): The slack in Wipro had more to do with the massive restructuring drive begun by discarding the joint CEO model, which, though, had helped during the reshuffle. Further, the margin gains due to the rupee depreciation may set the stage for a price war. Thus currency gains from the euro region would be limited. The slow growth in its net profit was due to the higher provisioning for taxes which rose 97 per cent. But, the moot question is will the rupee boost IT stocks performance for the rest of the year? Let;s examine how the rupee;s depreciation actually impacts top and bottom lines of companies. The stock;s upswing held to a similar trajectory as NIIT. Readers are advised to hold onto it, but avoid making fresh investments in the company at the current ruling prices. Yet, experts feel, that it needs to make massive efforts to regain lost market share and accelerate growth. Consider the latest quarter. The largest contributor for IT companies, the Banking, Financial Services and Insurance (BFSI) sector;s revenues declined over the previous quarter (fourth quarter of FY12). As an investment, however, most experts prefer Infosys to TCS despite the tepid ;guidance; given by the company. That is to say that offshore markets will gain share albeit at a lower pace, primarily because of the law of large numbers. Will the falling buck really help? Nevertheless, all positives regarding rupee depreciation at the top line will not trickle down to the net level.

For Infosys, the segment contributes a little less at 35 per cent and the percentage of fall was similar to that of TCS;s. For financial year 2012, the company reported revenue growth of 30 per cent. However, after the Lehman crisis in 2008, the pace of IT spending in BFSI sector has decelerated. IT companies, particularly large ones, are in the practice of hedging currency risks. It has completed its restructuring and appointed a new CEO and now its key indicators have begun to improve. At the ruling price, it trades at an inexpensive PE ratio of around five times and investors are advised to continue to hold the stock." They are also trading at discounts to larger peers (see When The Rupee Plunges). Mid-cap companies may take away deals from large companies as they agree to share with clients gains on currency depreciation." Adds Shah: "Mid-cap IT companies have done well. Investors should wait for corrections to pick up the stock. NIIT Technologies share price (Rs 285): For full year 2011-12, NIIT Technologies; revenue grew 27 per cent; its net profits grew 8. This is not bad given the economic climate we are faced with today. And stocks of IT companies have managed to fare better than the rest of the market.5 per cent year-on-year to Rs 582.. Tata Consultancy Services share price (Rs 1,230): Of the three large-caps, TCS came on top in both operational and guidance, and experts feel it would continue to lead the pack in the financial year 2013." In addition, companies are faced with tough times getting visa permits to send their employees to work overseas as the US government in late 2010, almost doubled visa غير مجاز مي باشدts for working professionals to bring jobs back home.

Alternatively, pressure to pass on some of the currency benefits to them may arise from clients. This was also the case with other companies. Given its near-bottom valuations, Infosys offers a higher upside than TCS". Says Shah, who has been advising clients to buy Infosys: "Although we are positive on TCS;s operational growth, we believe that the stock is fairly valued and offers limited upside from the present level. Wipro;s IT business CEO T. We recommended it at Rs 412. Now, where;s the demand? Further, Indian software companies are faced with much uncertainty due to economic problems in the developed world. This means the rupee depreciation added around Rs 2,985 crore to TCS;s top line. Kurien had said in a conference call that deal closures were delayed in the last quarter of 2011-12, but were picking up in the first quarter of 2012-13. Consider this: Tata Consultancy Service;s (TCS) revenues for financial year 2012 have risen by around 31 per cent. After we had recommended the stock at Rs 192 in January, it has risen by more than 50 per cent. I would advise investors to choose a mix of large-cap stocks, probably Infosys, and small-caps. However, the tepid ;guidance; in growth in US dollars disappointed investors. This will only get only better as, from the start of financial year 2013, the rupee has swiftly depreciated, by almost 10 per cent against the dollar.Nothing;s better for the IT sector than a plunging rupee. And, at the present price, it trades at nine times its earnings. TCS, for which BFSI constitutes 43 per cent of revenues saw a 2 per cent decline in revenue share. This has curtailed offshoring advantages.8 crore and its net profit surged by 42 per cent. We take a look at the three listed Indian IT giants.397): Infosys full year results beat analyst estimates as revenues grew 24 per cent. This year, the company is confident of beating NASSCOM;s guidance in-line closure of 11-14 per cent growth. Both have done well, both operationally and on the bourses. Advising investors to hold on to IT stocks, Sandip Gupta, vice-president Motilal Oswal Securities, says: "In mid-caps, we are comfortable with NIIT Technologies.

Zylog Systems share price (Rs 623): Zylog Systems; revenues rose by 22. Says Sinha: "For the first time, we are seeing smaller and mid-tier players fare better than larger companies because of the specialised focus and smaller scale. After weak guidances issued by IT companies after the end of financial year 2011-12, the sector got whipped on D-street, with a marked increase in volatility. For example, NIIT Technology suffered a Rs 13-crore loss for financial year 2012 on account of hedging. The trend may continue for a while, but the increased regulatory compliance through BASEL III norms, Dodd-Frank and other regulations will drive demand ahead. IT industry body NASSCOM has forecast 11-14 per cent growth for the IT sector. Says Dhananjay Sinha, co-head, Institutional Research, economist and strategist at Emkay Global: "Although the Indian IT sector has come of scale, with sceptics raising concerns on sustainability of revenue growth ahead, we believe that the thesis on Indian IT is unchanged.4 per cent. Sticking to high-margin businesses and, to some extent, its human resource initiatives are taking a toll on Infosys, both in revenue growth and margins. Says Dipen Shah, head of research, Kotak Securities: "There is a slowdown in orders from the US BSFI sector across the board. Now it trades at Rs 623.K