Tech Mahindra’s 28% profit jump sends Sensex soaring 965 points

Tech Mahindra shares jumped 3.9% on Friday after the IT major reported a 28.4% rise in net profit for the June quarter to Rs 1,465 crore, and the company said it remained confident about the demand environment going forward. The stock’s rally helped lift the broader market, with the BSE Sensex climbing 965 points and the Nifty reaching the 24,330 level by the close of trade.

The gains came even as the wider market stayed mostly weak, with traders pointing to soft global cues weighing on sentiment through the session. Large-cap IT and banking names, however, found strong buying interest as investors responded to a string of encouraging Q1 earnings updates from index heavyweights.

Vinod Nair of Geojit Investments said there has been a clear shift in market momentum toward large-cap stocks, led by the IT and banking sectors, supported by optimism around business updates and Q1 earnings expectations. He added that domestic institutional investors appear to be rotating out of expensive mid- and small-cap stocks and into large caps offering a better risk-reward profile.

Alongside Tech Mahindra, Kotak Mahindra Bank, Tata Consultancy Services, Reliance Industries, Hindustan Unilever, Mahindra & Mahindra, Axis Bank, ICICI Bank and Bajaj Finance were among the day’s other gainers on the Sensex. Sun Pharma, Trent, Bharti Airtel and UltraTech Cement ended among the laggards, with the commodities, industrials, telecommunication and metal segments underperforming.

The rupee also strengthened, gaining 14 paise to settle at 96.3 against the US dollar, adding to the improved mood on Dalal Street. Brent crude, meanwhile, climbed 1.79% to $85.5 a barrel during the session.

Ponmudi R, CEO of online trading and wealth-tech firm Enrich Money, said Indian equity markets ended the week on a strong note, extending their recovery as broad-based buying in heavyweight banking, financial and IT stocks helped benchmark indices outperform weak global cues.

Wikimedia Commons/by Pradeep717