New Delhi, Oct 9 (PTI) IT stocks emerged as the major catalysts behind the market’s sharp recovery on Friday, following an over 4 per cent rally in TCS after it reported better-than-expected September quarter results.
Indian IT companies largely brushed aside the news regarding the US suspending eight IT firms, including TCS, Infosys, Wipro, Cognizant and Microsoft, from a programme that allowed applications for green cards for foreign workers, contending that the practice has shut out Americans from the job market.
Shares of Tata Consultancy Services (TCS) ended over 4 per cent higher on Friday after the company reported a 15 per cent jump in the July-September quarter net profit to Rs 13,884 crore and pointed to continued growth momentum going forward.
TCS on Friday said it does not expect the US action on the green card programme to affect its workforce strategy or customer engagements, as India’s largest IT services company cited its single-digit applications under the programme over the past two years and its focus on local hiring.
The stock rallied 4.23 per cent to end at Rs 2,163 on the BSE.
Likewise, Hexaware Technologies surged 5.69 per cent, LTM Ltd jumped 4.01 per cent, Infosys climbed 3.01 per cent, HCL Tech was up 2.84 per cent, Wipro rallied 2.59 per cent and Tech Mahindra advanced 1.43 per cent.
Together, all these firms added Rs 65,648.78 crore in market valuation.
The BSE IT index surged 2.91 per cent to end at 27,406.62.
“Stronger-than-expected support from TCS earnings and broad-based buying across IT, banking and financial stocks helped lift the Nifty 1.30 per cent to 22,520.45,” Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, a Research Analyst firm, said.
IT stocks led the recovery despite the US suspension of major technology companies from the PERM programme, he said.
“Investors appeared reassured by the clarification that the restriction affects the employment-based green card process rather than existing H-1B employment, limiting the immediate operational fallout. TCS’ 15 per cent profit growth, strong AI-related revenue and healthy deal wins provided an additional boost, helping investors look beyond near-term immigration concerns. However, a prolonged suspension could still raise localisation and employee-retention costs for Indian IT companies over time,” Radhakrishnan added.
The 30-share BSE Sensex jumped 879.09 points, or 1.23 per cent, to settle at 72,472.33. The 50-share NSE Nifty rallied 288.65 points, or 1.30 per cent, to end at 22,520.45.
“Our PERM applications were in single digits in the last two years, and hence we do not expect the suspension of the program to impact our workforce strategy and customer engagements,” TCS said in a statement.
The company said it will comply with any directive from the US Labor Department, and emphasised its workforce strategy is firmly anchored in hiring local talent, supported by a robust campus recruitment model.
“We have noted the announcement by the US Government on the Permanent Labor Certification Program (PERM), and TCS will comply with any directive from the Department of Labor. Our workforce strategy in the US is anchored in hiring local talent, supported by a robust campus recruitment model,” it said, adding that the company has built a significant local workforce across 31 offices and delivery centres throughout the country.
After the US suspended eight tech firms, including prominent Indian ones, from a key green card programme, industry body Nasscom said immigration and skilled talent mobility are “two distinct issues” that should not be viewed through the same lens.
“IT stocks led the advance after Tata Consultancy Services reported better-than-expected September quarter results,” Ponmudi R, CEO of Enrich Money, an online trading and wealth tech firm, said. PTI SUM HVA
This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.