HCL Tech top pick in IT sector: Surendra Goyal

Surendra Goyal of Citi India told CNBC-TV18, "We are neutral on TCS right now primarily around valuation concerns. Our view is that TCS has a significant premium to both the Indian names as well as the US listed peers which the IT companies have. To that extent it is very difficult to see a rerating in the stock. The execution has been solid and because of that the stock has continued to do well, but we really do not see a rerating happening."

"On Wipro, they have seen some improvement, but the deal wins have not really been significant enough to call for a near-term turnaround. There have been some improvements, like client mining has gone up. Number of 100 million dollar clients going up, attrition coming down. There are some qualitative improvements, but it is really difficult to say that in the next six months we are going to see a big pick up,"Surendra Goyal
He further added "HCL Tech has been our top pick in the sector for the last three years or so. We continue to like it. It is company with a solid execution. Over the last 10-12 quarters teh stock has been continuously doing well. Return on Equity (ROE) of around 30 percent, so those have also been going up and yet you are getting the stock today at 13 times this year's earnings. Clearly the stock does look attractive at 13 times FY14. It is our top pick in the space."