Investor hopes from Indian IT rise after HCL Tech’s earnings update

Stocks of IT services companies got a boost after HCL Technologies Ltd surprised the Street with its pre-quarter earnings update. The $9.9 billion IT major said it expects revenues to grow by over 3.5% in the second quarter, higher than the 1.5-2.5% growth it had projected in July. What’s more, operating profit margins are now estimated to be about 100 basis points above its earlier target.

HCL’s shares jumped by over 10%, and the company’s better prospects raised hopes of an improvement in the entire industry’s performance in Q2. The Nifty IT index rose 4.7% on Monday, making it the biggest gainer among sectoral indices on the NSE.