IT stocks zooms as Indian rupee slips to 8 month low

Meanwhile the BSE Sensex was down 87.49 points or 0.50% to 17,285.52

India`s second largest software exporter by sales TCS was the top gainer from Sensex pack. The stock surged 3.22% to Rs 968.05 on 4.46 lakh shares.

Other Infosys Technologies (up 1.36% to Rs 1846), Wipro (up 0.30% to Rs 499.80), and Satyam Computers (up 0.20% to Rs 496.20), advanced.

The BSE IT sector outperformed the market over the past one month till 6 May 2008, gaining 18.87% compared to the Sensex`s return of 10.26%. It also outperformed the market in the past one quarter, advancing 14.93% compared to Sensex`s decline of 4.23%.

A firm dollar augurs well for IT pivotals as they derive majority of revenue from exports. The Indian rupee fell further sharply by 19 paise to Rs 41.13/14 against the American dollar as oil companies stepped up dollar buying after the global crude oil hit yet another high amid weakness in local stock.

IT pivotals had advanced steadily after India`s second largest software exporter by sales Infosys Technologies issued decent guidance for the year ending March 2009. Infosys has given guidance of a between 16.3% to 18.3% growth in earnings per share (EPS) to between Rs 92.32 to Rs 93.92 for the year ending March 2009 (FY 2009) over the year ending March 2008. It has given guidance of a between 19.2% to 21.1% growth in revenue to between Rs 19894 crore to Rs 20214 crore for the year ending March 2009 over the year ending March 2008

As per US GAAP, Infosys has given guidance of a 16.7% to 18.7% growth in earnings per American Depository Shares at between $2.31 to $2.35 for the year ending March 2009 over the year ending March 2008. It has given guidance of a between 19% to 21% growth in revenue as per US GAAP to between $4.97 billion to $5.05 billion for the year ending March 2009 over the year ending March 2008

The company sees significant growth opportunities in the medium to long term. It, however, may face short-term challenges due to global economic uncertainties