Market Update 5 Jan. 2021 – IT stocks buoyed by Q3 expectations

IPO rush to continue in 2021

  • As many as six companies are likely to come out with an IPO this month. Overall, the street expects at least 15 companies to go public in 2021.
  • Better-than-expected-economic recovery, strength in equity markets and the favourable response to recent IPOs have been touted as key reasons encouraging companies to go public.

Talbros Auto jumps on Q3 update

  • Shares of gasket and forgings maker Talbros Auto rose over 7.8%, supported by strong volumes. The company announced that in Q3, its gasket business grew 25% over the same quarter in 2019, while its forgings business grew 45%.
  • Gaskets contributed about 65% of its revenues and forgings covered the balance. The company derives two-thirds of its sales from the domestic market and supplies to major OEMs such as Hero MotoCorp, Bajaj Auto and Maruti among others.

KNR Constructions gains on project win

  • The infra-projects player has bagged a ₹603 crore contract for the upgradation and maintenance of a highway project in Chennai.
  • The stock rose 5.4% intraday and closed 0.6% higher today. It is currently trading around its previous lifetime high of ₹350, which it hit in December 2017.

IT stocks buoyed by Q3 expectations

  • Traditionally, IT companies have been the first to kick off the results season. For Q3, the street is upbeat on the results against the backdrop of a healthy order pipeline, large order wins and a favourable outlook guided by Accenture Plc.
  • Major IT stocks such as TCS (+1.6%), Infosys (+0.1%), Wipro (+2.3%) and HCL (+1.2%) rose today. In Q3, these stocks have delivered have delivered gains ranging from 15–25%.