Sandip Agarwal, Research Analyst-Institutional Equities, Edelweiss Securities, on Friday said that he is bullish on the entire IT sector and that HCL Technologies will be the best-performing stock in that space.

“I don’t have any negative view or even a bearish view on any stock in the whole sector. I am bullish on every single stock. I am very confident that this cycle is of IMS and cloud and the best-performing stock will be HCL Technologies in the whole pack. It is also comparatively cheap to other names. So from a percentage return perspective, HCL Technologies is a no brainer and I will keep it as the top pick for at least the next few quarters,” he said in an interview with CNBC-TV18.

HCL Technologies on Friday reported a jump in Q3 net profit to Rs 3,982 crore on the back of robust momentum in Mode 2 and Mode 3 businesses led by digital, cloud and products and platform segments. This was ahead of CNBC-TV18's estimates of Rs 3,201 crore.

On HCL Tech Q3 numbers, he said, “It is an excellent set of numbers. We are just 10 million off our estimate. We estimated dollar revenue growth of USD 2,607 million and they reported USD 2,617 million. Our constant currency estimate was 3.5 and dollar was 4. I think they have more benefits on the cross currency than what we anticipated. Margins - we were anticipating 22.2 percent and they have reported 22.9 percent. So that is slightly ahead of our numbers, 60-70 basis points. I think these surprises will keep on continuing; I think no analyst, no company will be able to predict this wave. It is a very big wave; we will always underestimate the growth and we will always underestimate the margins and every quarter the reason of underestimation will be different."

Agarwal said that their FY23 EPS is at Rs 63. However, he said that they are re-evaluating after the Q3 numbers and are likely to upgrade the EPS estimates. They have a target price of Rs 1,481 on the stock.

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(Edited by : Niral Sharma)