There is a fair bit of upside in HCL Technologies, said Girish Pai, Head of Research at Nirmal Bang Institutional Equities in an interview with CNBC-TV18.
"The stock has been punished for the investment it has made in the products business of IBM. The market has been attributing fair bit of negative value to that and is probably not giving adequate valuations for the IT and ITES business that the company has had which is as good as any tier-I company in the market," he said.
He feels there could be a price to earnings multiple rerating in the stock and that it is in a position to deliver fairly good organic growth in the IT/ITES business over the next 2-3 years.
Pai also believes that the street is going to value the products business better than what it is valued at in the past.
Speaking about IT sector as a whole and Tata Consultancy Services (TCS) in particular, he mentioned, “We have a neutral stance on the sector as we speak. On the TCS we have an accumulate stance with probably like a 2-3 percent upside, nothing more than that."