Barclays starts India tech coverage; Overweight on Infy, HCL Tech

Mumbai: Barclays Capital has started coverage on the Indian technology sector with an overweight rating on Infosys Ltd and HCL Technologies citing higher growth rate for the next five years.

It put a price target of Rs 3,050 for Infosys and Rs 485 for HCL.

[caption id="attachment_101263" align="alignleft" width="380" caption="The British bank said the growth for the large vendors will likely be driven by increased outsourcing. Reuters"][/caption]

The British bank said the growth for the large vendors will likely be driven by increased outsourcing as customers seek a more flexible cost model. Limited availability of technical staff in the developed world and a shift to new business models led by themes of cloud, mobility and social networking, among others will also help growth, it said.

"While we accept that current economic uncertainty limits visibility, our economists argue that uncertainty is unlikely to turn into recession," it said.

Barclays rated top software firm Tata Consultancy Services at equal-weight with a price target of Rs 1,150 while put an underweight rating on Wipro with a price target of Rs 340.

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Reuters