Why CLSA prefers Coforge, LTIMindtree over large cap IT stocks after Cognizant cut revenue outlook?
Cognizant Technology Solutions’ June-quarter earnings reinforce CLSA’s preference for select mid-tier Indian IT companies, with the brokerage retaining a ‘High Conviction Outperform’ rating on Coforge and an ‘Outperform’ rating on LTIMindtree.
The brokerage believes that the quarter also points to intensifying competition in the banking, financial services and insurance (BFSI) segment, while recent gains in large-cap IT stocks leave less room for further upside. CLSA retains a target price of Rs 2,170 on Coforge, implying 26.8% upside, and Rs 4,570 on LTIMindtree, implying 3.7% upside.
