Tough to make a big bull case for IT; look for commentary: Sandip Sabharwal

"Earlier, IT stocks were expected to make a hard landing in the western economies. Now that theory is changing to a possible soft landing and that has led to many of these stocks actually rallying post mixed commentary after the first quarter results. From where they have reached, making a big bull case is tough," says Sandip Sabharwal, asksandipsabharwal.com

How are you looking at the entire IT pack at the moment? Is it going to be very niche companies or are even the largecaps are offering a good buying opportunity?
IT companies are now in a zone where it is tough to predict which side it will go. Earlier there was an expectation that there could be a possible recession, hard landing in the western economies, now that theory is changing to a possible soft landing and that has led to many of these stocks actually rallying post mixed commentary after the first quarter results.

From where they have reached, making a big bull case is tough. I think we need to watch how the commentary plays out going forward. At this stage, I would think that the majority of them are pretty fairly valued.


Are you looking at ONGC as a story?
No, I am not and I think it is very tough to see where this production increase will come from. I do not think they have any such oilfield or new discoveries which will actually lead to a production growth of as much as 4% to 5% because 4% to 5% increase is quite substantial. If they are actually able to achieve it, then I think the stock should be going much higher but I would be extremely sceptical.