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Tech stocks in focus: Tata Elxsi jumps 7%, Infosys, TCS down 2.5%; here's why

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IT stocks trade mixed: Infosys, Tata Consultancy Services (TCS), Zensar Technologies, and HCL were trading in red on Thursday, pulling the sectoral gauge nearly 2 percent lower on BSE. However, Tata Elxsi and Nazara Technologies’ shares were in the green.

Tech stocks in focus: Tata Elxsi jumps 7%, Infosys, TCS down 2.5%; here's why
Heavyweight tech stocks like Infosys, Tata Consultancy Services (TCS), Zensar Technologies, and HCL were trading in red on Thursday, pulling the sectoral gauge nearly 2 percent lower on the Bombay Stock Exchange (BSE). However, Tata Elxsi and Nazara Technologies’ shares were in the green territory rallying more than 5 percent.
Infosys shares slipped 2.6 percent to an intraday low of Rs 1818.30 on BSE. The scrip, trading 2.53 percent lower, was the top contributor to losses in the benchmark Sensex index at the time of writing.
The downtrend comes on a day Salil Parekh, MD & CEO of Infosys, told CNBC-TV18 demand has shot through the roof in recent times as large enterprises are globally going through a digital transformation.
Zensar Tech stock, on the other hand, declined more than 3 percent intraday at Rs 458.80 whereas the shares of IT behemoth Tata Consultancy Services (TCS) slipped 2.5 percent to an intraday low of Rs 3814.00.
Contrary to an overall trend in IT stocks, the Tata Elxsi witnessed a massive rally of 7.5 percent and touched a 52-week high of Rs 7,499. Nazara Technologies shared soared as much as 5 percent.
Analysts have favoured the shares of information technology firms for a while now, expecting their rally to continue in the medium term. However, market expert Mehraboon J Irani, who is positive on the sector, advised against making a fresh entry into the tech space.
“If you want to make 5-10-15 percent returns at most in 2022, IT is a sector to be in but in a market in which we all learn to identify stocks and make 20-40 percent returns in 2021, is IT the space to make a fresh entry? My answer was no. So if I'm holding IT stocks, I'll continue to hold on but I will not put in fresh money because I find there's not much upside despite the story being excellent,” he told CNBC-TV18.
According to him, IT is a story that has been discovered, well digested and virtually everybody on the street have at least 10 to 15 percent of IT in their portfolio.
“So, everybody who asked has at least three IT stocks…Also, post HCL Technologies, TCS and Infosys announcing the numbers, what we saw in the stock price reaction gave a clear indicator that somewhere the market is saying that okay, fine, so you are good, the share prices also are higher,” he said.
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