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Business News/ Markets / Stock Markets/  This IT stock delivered 35% return in one month. Should you buy now?
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This IT stock delivered 35% return in one month. Should you buy now?

This IT company deals in digital and cloud business, which has huge business prospect post-Civid-19, say experts

Rupee-dollar tailwinds has also worked in favour of the company as it receive payments in US Dollar and encash them in Indian Rupee, say experts.Premium
Rupee-dollar tailwinds has also worked in favour of the company as it receive payments in US Dollar and encash them in Indian Rupee, say experts.

Mindtree share price: On account of strong cloud and digital business outlook and sliding Indian National Rupee (INR) against the US dollar (USD), Mindtree shares surged around 35 per cent in one month. According to stock market experts, the company has huge business network in the US, UK and other European countries. It deals in digital and cloud business, which has huge business prospect post-Civid-19 as corporates are going to invest heavily in digital and cloud segment. Apart from this, rupee-dollar tailwinds has also worked in favour of the company as it receive payments in US Dollar and encash them in Indian Rupee.

Speaking on the fundamentals supporting Mindtree share price rally; Avinash Gorakshkar, Head of Research at Profitmart Securities said, "Mindtree has reported strong first quarter numbers. IT is mainly in digital and cloud business, which has strong outlook post Covid-19 as corporates are expected to invest heavily in cloud and digital segment. Apart from this, the company has strong business network in the US, UK and other European nations. It receives payments from its overseas clients in US dollar terms while it encash them in Indian in rupees. So, in the wake of rupee sliding against the US dollar, it is getting some currency premium benefit as rupee-dollar tailwinds has worked in favour of Mindtree and other IT companies."

Avinash Gorakshkar of Profitmart Securities went on to add that market is expecting strong quarterly numbers for July to September 2021 as well. Since, the stock has already surged around 35 per cent in the last one month; one should maintain 'buy on dips' strategy in this IT counter and hold long.

Suggesting investors to buy Mindtree shares; Sumeet Bagadia, Executive Director at Choice Broking said, "Mindtree share price has strong support at 3400 levels. One can buy the counter at current levels and keep on accumulating till it is trading above 3400 levels for the short-term target of 3800 to 4000." However, he advised strict stop loss at 3400.

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Asit Manohar
Chief Content Producer at Live Mint Digital Team
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Published: 28 Aug 2021, 12:43 PM IST
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