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As rupee slid to a record low, research house HSBC said hopes are high from IT companies which is reflected in their premium valuation. It believes Q2FY19 earnings should be decent but are unlikely to be an upside trigger.
September quarter earnings season will be kicked off by TCS on October 11 followed by Infosys on October 16.
"2-3 years demand visibility is decent and the rupee weakness provides a margin cushion," HSBC said.
The Indian rupee has depreciated nearly 15 percent year-to-date to hit a record low of 73.41 against the US dollar on Wednesday.
The global research house has a Buy call on Infosys with an increased target at Rs 880 from Rs 830 per share earlier and also has Buy rating on HCL Technologies with an increased target at Rs 1,180 from Rs 1,120.
On other stocks like TCS, Wipro, Tech Mahindra, Mindtree and Mphasis, HSBC has Hold call with increased target at Rs Rs 1,990 (from Rs 1,910), Rs 300 (from Rs 290), Rs 780 (from Rs 740), Rs 1,220 (from Rs 1,200) and Rs 1,200 (from Rs 1,190) respectively.
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