Infosys, Coforge, TCS, Wipro, HCL, LTM, Persistent, Mphasis: IT stock with highest upside target

With the Q1 earnings season underway and Tata Consultancy Services Ltd (TCS), LTM Ltd and HCL Technologies Ltd (HCL) already declaring their June quarter results, data showed Infosys Ltd among the Nifty IT firms has the highest consensus target upside. 

At 21 per cent upside projection, the second-largest IT exporter is the only index stock with a double-digit upside forecast. Oracle Financial Services Ltd, on the other hand, is the only stock among the 10 index constituents with a consensus target showing downside potential. As more IT firms announce their quarterly results going ahead, consensus targets are seen revision over the next couple of weeks. 

Infosys leads consensus targets
The 12-month consensus target for Infosys, based on 51 analyst estimates, stands at Rs 1,332.83 apiece, Bloomberg data compiled by Business Today suggests. TCS target for the next one year, based on 48 analyst recommendations, stands at Rs 2,408.75, hinting at a potential 9.5 per cent upside. It is followed by Wipro (target: Rs 194.28), Mphasis (target: Rs 2,603.82), HCL Tech (target: Rs 1,283.66) and Coforge (target: Rs 1,684.62), whose targets suggest 8-9 per cent upside for the next 12 months. 

Wipro will declare its Q1 results on July 16, Infosys and Mphasis on July 23, and Coforge on July 27. 

LTM's target at Rs 4,356.30, based on 44 estimates, suggests 5.6 per cent potential upside. TechM (target: Rs 1,551.02) and Persistent Systems (target: Rs 5,206) offer flattish upsides while the consensus target suggests Oracle Finance Services offers 8.3 per cent potential downside.

Q1 results season & IT rally 
IT stocks have recovered smartly of late, with the Nifty IT index gaining 3.55 per cent in the past five sessions. Oracle Financial Services, LTM and Persistent Systems have jumped 6.6 per cent each, followed by TCS an TechM, which advanced 4-5 pr cent. Wipro, Infosys, Coforge, HCL Tech and Mphasis have risen up to 3 per cent during the same period. Stocks gained on better Q1 results following muted expectations and partly due to inexpensive valuations.

"IT stocks are bouncing back from  low levels helped by low valuations and better-than-expected Q1 results from TCS and HCL Tech. This appears to be a short-term tactical trade," said Vijayakumar, Chief Investment Strategist at Geojit Investments.

Indian IT companies entered Q1 earnings season with a muted expectations as macroeconomic uncertainty, geopolitical tensions in West Asia and AI-led
pricing pressures were seen continuing to delay client decision-making, prolong deal conversions and slow deal ramp-ups. 

While management commentary indicated FY27 could be better than FY26, the anticipated demand recovery remained elusive.