N Sheth bullish on IT space

Nirav Sheth, Head-PMS, BRICS Securities is bullish on IT space.

Sheth told CNBC-TV18, "We are bullish on IT. Software is been seeing as some sort of a pro-oil play. So when you have got higher oil prices, you try and hide into software because high oil prices means rupee depreciating and rupee depreciating means higher near-term earnings for the software. To us a lot of that is noise because over the longer-term we would still expect that the dollar earnings would compound anywhere from 18-19%; for bulk of the software companies our valuations are in the region of 12-15 times forward with an incremental ROC in the region of about 30-35%. Over the longer-term business models will evolve to try and counter the strong rupee appreciation trend, net-net we see value in this sector."

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