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IT index surges 190 pts on ECB curbs, weak rupee

IT index surges 190 pts on ECB curbs, weak rupee

PTI

Mumbai: Stocks of software exporting firms were back in the limelight across the board today after the government imposed restrictions on the external commercial borrowings to cap the rupee’s surge.

The BSE IT index was the third best performer among segment indices with a hefty rise of 189.96 points, or 4.11% at 4,808.43, contributing key support to the Sensex, which ended 375.21 points higher at 15,307.98.

All 12 constituents of the IT sector index ended in positive zone with sizeable gains.

Market observers said measures, announced by the government yesterday, to tighten the norms for companies to borrow from overseas to check the rise in rupee value against other currencies resulted in increased trading in IT stocks.

As per the changes, a company raising $20 million of External Commercial Borrowings (ECBs) would have to seek prior permission of RBI to bring such funds into India.

A 9% rise in the value of rupee against the dollar this year has hit the profit margin of software exporters of the country. Over 50% software export revenue comes from the US.

IT bellweather, Infosys Technologies stocks saw brisk buying activity throughout the session and climbed Rs88.85 at Rs1,967.60, while TCS gathered Rs45.80 at Rs1,153.70.

Wipro Ltd gained 16.55 at 475.85 and Satyam Computers was up by 16.30 at 479.30.

Other gainers were HCL Technologies, which rose 8.95 at 17, Mphasis ( 8.60, 03.95), Tech Mahindra ( 2.25, ,282.55), Financial Technologies ( 3.20, 2,452), i-Flex ( 7.65, ,2129.50) and Rolta India ( 1.45, 63.35).

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