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IT stocks disappointed in 2022 due to global crisis, record decline in Nifty IT after 2008

IT Sector In India: The IT sector of the country may have to bear the major brunt of the Global Economic Crisis. The IT sector dependent on America and European countries may have to see the upcoming slowdown in these countries. The effect of this fear can be seen in the form of a decline in the IT sector. In 2022, the Nifty IT index has declined by 25 percent. Nifty IT has posted its most disappointing performance since 2008 when the index plunged 55 per cent during the Global Financial Crisis following the bankruptcy of Lehman Brothers in the US.

Nifty IT fell 25 percent in 2022

In January 2022, Nifty IT touched the figure of 39,446. After that, due to the Russia-Ukraine war, there was a huge fall in the stock markets around the world and the Nifty IT index fell to the level of 26,186. At present, the Nifty IT index is trading at 29,376 points, which means it is down 25 percent from its high. Be it the shares of IT sector giants or midcaps, all the stocks have been beaten up tremendously. Shares of companies like Wipro, Mindtree, HCL Tech, Infosys, and TCS have come down by 15 to 45 per cent from their highs in 2022.

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Earning was tremendous in Kovid period

During the Kovid period, when people were working from home, there was a tremendous increase in the earnings of IT companies. For the last five years, the IT index was giving a return of 31 per cent annually. But due to economic slowdown in developed countries, there is a huge reduction in IT companies. IT companies export 90 percent of services in these countries. In such a situation, these companies may have to face a crisis in the coming times. These companies may also have to bear the brunt of increasing the interest rates of the Federal Reserve on them.

Earnings may decrease

Last week, the management of HCL Tech has reduced its earnings guidance. In the analyst call in New York, the company said that its growth rate in the second quarter could be in the lower end of the estimate of 13.5 to 14.5 percent. The company says that this crisis can continue for a long time. After this news, there was a tremendous decline in the shares of IT companies.

Big fall in IT stocks

If you look at the performance of IT companies, then in 2022, the share of Infosys has fallen by 20 percent. HCL Tech’s stock has fallen by 20 percent. Tech Mahindra has come down 43 percent. L&T Technology has declined by 34 percent. Wipro has fallen 45 per cent, while TCS stock is trading 17 per cent below its 2022 high.

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