Best IT Sector Stocks in India
(The stocks mentioned in the blog are as per Analyst Ratings and Market Capitalization)
Information Technology (IT) sector is vital to India's economy, contributing significantly to the GDP and driving export revenue. Despite market fluctuations caused by the COVID-19 pandemic, the IT sector remained resilient, with stable stocks that helped boost the overall performance of the stock exchange, reaching new highs.
During the pandemic, IT infrastructure and services played a crucial role in enabling remote work, highlighting their importance.
Information Technology Industry in India - A Brief Overview
India’s IT sector emerges as a key player in its economy, providing a wide range of services and activities. It is widely known as the Information Technology and Business Process Management (IT-BPM) industry. This industry comprises IT services, software products, engineering research and development, business process outsourcing and e-commerce.
In the 21st century, many IT startups have emerged, especially in e-commerce, data analytics, fintech and artificial intelligence, attracting significant investments and disrupting traditional industries. The government has implemented various initiatives such as Digital India, Make in India and Startup India to foster entrepreneurship and technological innovation.
Despite facing challenges such as intensified competition, evolving global economic dynamics and rapid technological changes, the Indian IT industry remains adaptable and innovative, ensuring its competitiveness on the global stage.
Indian IT companies have consistently achieved robust economic growth, leveraging skilled manpower, cost advantages and favourable outsourcing policies. As technology remains pivotal in global enterprises, investments in Indian IT firms indicate a sector well-positioned for ongoing expansion and innovation.
According to a report, the revenue of the IT industry is expected to grow annually at a rate of 12.98% from 2024 to 2028, reaching a market volume of US$43.09 billion by the end of the period.
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Best Information Technology Stocks in India 2024 as per Analyst Ratings
Here is a table mentioning the best IT sector stocks as per analyst ratings. We have made this list based on analyst ratings provided by the I/B/E/S database as stock market analysts rate a stock after carefully analysis a stock’s performance in the market.
Let’s have a look at the list now-
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S.No. |
Information Technology Stocks in India (as per analyst ratings) |
BUY Analyst Rating (in %) |
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1. |
51 |
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2. |
50 |
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3. |
49 |
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4. |
48 |
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5. |
45 |
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*Our stock selection criteria for top stocks based on analyst ratings are mentioned at the bottom of this blog. |
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Top Information Technology Stocks in India in 2024 as per Market Capitalisation
The following table mentions the top IT sector stock list according to market capitalisation:
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S.No. |
Information Technology Stocks in India (as per market capitalisation) |
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1. |
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2. |
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3. |
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4. |
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5. |
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*Our stock selection criteria for top stocks based on Market Capitalisation are mentioned at the bottom of this blog. |
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Overview of Best Information Technology Stocks as per Analyst Ratings
The following is a comprehensive overview of India’s best IT stocks of 2024 as per analyst ratings:
1) Tata Consultancy Services
Headquartered in Mumbai, Tata Consultancy Services Limited (TCS) is one of India’s renowned IT service providers. The company offers a wide range of services, including artificial intelligence, data and analytics, cognitive business operations, consulting services, enterprise solutions, cloud services, IoT digital engineering, sustainability services and more.
TCS serves various industries, including healthcare, manufacturing, banking, education, high-tech, life sciences, insurance, consumer goods and distribution, travel and logistics, public services, etc.
2) KPIT Technologies
Established in 2018, KPIT Technologies Limited specialises in providing embedded software solutions for the automobile and mobility industry.
The company offers various solutions, including autonomous driving and ADAS, electric and conventional powertrains, connected vehicle technology, AUTOSAR, integrated diagnostics and aftersales transformation (iDART), vehicle engineering and design, digital connected solutions and body electronics.
Its autonomous driving and ADAS solutions cover areas like cybersecurity, architecture development, requirement authoring, artificial intelligence, machine learning, computer vision and model-based development for control functions.
Additionally, KPIT offers ready-to-use software platforms for various electric vehicle components that are AUTOSAR compliant. With over 12,000 experts worldwide, KPIT helps its clients swiftly adopt next-generation technologies for future mobility. KPIT Technologies has its engineering centres in the USA, Japan, Europe, China, Thailand and India.
3) HCL Technologies
Headquartered in Noida, HCL Technologies is one of the leading software and IT infrastructure service providers. The company offers a wide range of IT services, including digital consulting, hybrid cloud, supply chain management, data and analytics, cognitive automation, product engineering, cybersecurity services, SaaS, R&D services, HCL software services and other allied services.
HCL Technologies also provides services to various industries, including banking, insurance, fintech, capital markets, life sciences and healthcare, manufacturing, mining, natural resources, retail, consumer goods, telecom media and entertainment and more. The company manages a worldwide offshore infrastructure and maintains a network of offices throughout the Middle East, Europe, Asia-Pacific and Africa.
4) Infosys
Located in Bangalore, Infosys Limited is a digital services and consulting service company, providing technology-enabled business solutions. The company offers a wide range of services, including digital marketing, digital workspace, data analytics and AI, blockchain, IoT, engineering services, salesforce, digital process automation, cybersecurity, cloud services, consulting services, etc.
These products and services cater to diverse industries such as aerospace and defence, agriculture, automotive, communication services, consumer packaged goods, education, financial services, healthcare, high technology, industrial manufacturing and so on. Infosys’ operational units are spread across Europe, the Middle East, Africa and Asia-Pacific countries.
5) Persistent Systems
Headquartered in Pune and established in 1990, Persistent Systems Limited is an Indian technology services company specialising in software product development and maintenance.
The company offers a wide range of services, including intelligent automation, cloud and infrastructure, application development and management, CX transformation, consulting, data and analytics, enterprise integration, software product engineering and enterprise IT security.
Persistent Systems’ caters to various industries such as consumer tech, software and high-tech, telecom and media, insurance, healthcare, life sciences, banking and financial services. Its cloud and infrastructure section comprises cloud advisory services, data centre modernization, persistent intelligent IT operations, and hybrid and multi-cloud transformation.
Factors to Consider Before Investing in Information Technology Stocks in India
Before buying a stock in the IT sector in India, you must consider the following factors to make an informed investment decision:
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Company Size and Features
When you invest in IT stocks, consider whether these companies offer a wide range of services across different sectors like banking, finance, insurance, entertainment, etc. You must ensure the company you choose provides reliable services and has the right tools for growth.
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Innovation and Technology
You must look out for IT companies that are coming up with new and game-changing technologies. Companies that create and sell innovative products tend to do better in the market.
Keep an eye out for new ideas, patents and cutting-edge technology, as these can boost the value of IT stocks.
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Competition
The IT industry is highly competitive, with many companies competing for market share. You must look at how well a company is competing against others in the market. Factors like product differentiation and partnerships can influence IT stocks.
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Industry Trends and Demand
New technologies like blockchain and artificial intelligence can create opportunities for IT companies to grow. By keeping up with industry trends and customer preferences, you can make more informed decisions about investing in IT stocks.
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Economic Conditions
Economic factors like GDP growth, interest rates, and consumer spending affect IT stocks. IT companies might struggle during economic downturns, but they can thrive during times of growth.
Should You Invest in Information Technology Stocks?
When considering whether to invest in IT stocks in India, it is important to learn about the various companies operating in this sector, from software development to IT services.
The performance of IT stocks is affected by market competition, technological advancements and regulatory changes. Therefore, you must stay informed about market developments and regularly review your investment strategy to ensure it aligns with your financial goals and risk tolerance.
The Bottom Line
Investing in IT stocks in India could be a profitable choice despite the risks involved, as long as proper research is conducted before making any investment decisions.
The leading IT sector stocks are experiencing rapid growth in India, prompting major IT companies in the country to focus on innovation and advanced technology. However, to make an informed investment decision, you must conduct thorough research and assess the IT companies’ performances.
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*Stock Selection Criteria for Top Stocks Based on Analyst Rating Investors must carefully read through the following information on stock selection criteria while running through the stocks based on analyst ratings- These stocks have been shortlisted as per Analyst ratings provided by the I/B/E/S (The Institutional Broker’s Estimate System) database, further aggregated by Refinitiv. Ratings are determined by analysts' forecasts of company performance, taking into account metrics like earnings per share, sales, and net income. These ratings should not be construed as investment advice/recommendations/offer/solicitation of an offer to buy/sell any securities by Groww Invest Tech Pvt. Ltd. (formerly known as Nextbillion Technology Pvt. Ltd.). Before investing, investors must conduct independent research and not solely rely on the information provided here. This will allow investors to make appropriate investment decisions based on their financial goals, investment objectives and risk tolerance. |
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*Stock Selection Criteria for Top Stocks Based on Market Capitalisation These stocks are chosen based on their market capitalization, which represents the total value of a company's outstanding shares. The selection is arranged in descending order, placing the largest companies first and the smaller ones later. This helps prioritize stocks based on their market size. It is important to note that market capitalization in no way guarantees a company’s performance or the returns from its stocks. However, it can be used as a criterion for shortlisting companies from within a sector. Investors should recognize that other factors, such as financial health, management efficiency, and market trends, play crucial roles in determining the actual success of an investment. This stock selection should not be construed as investment advice/recommendations/offer/solicitation of an offer to buy/sell any securities by Groww Invest Tech Pvt. Ltd. (formerly known as Nextbillion Technology Pvt. Ltd.). |
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Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory. To read the RA disclaimer, please click here |