Better returns would come from midcap IT companies: Dipan Mehta, BSE and NSE

In a chat with ET Now, Dipan Mehta, Member BSE and NSE, shares his views on the current outlook of the IT sector. Excerpts:

ET Now: What would be the impact of Infosys' result on mid-tier IT companies?

Dipan Mehta: In midcap IT, there is a scope for derating of the price earning multiples. A lot of the midcap IT companies are trading at a discount to the large cap IT. Given the improvement in the fundamentals and the currency depreciation which has taken place, one feels that they could higher PE multiple.

These midcap IT companies have managed to survive a lot of the volatility that has taken place within the industry at the market level and at the consumer level.

Hence, I would say that for the informed investor, the better returns would come from the midcap IT companies. Some of the laggards, which have not been delivering, could come back into focus.

Thus, from all the results which are expected out this earning season, the ones that we and the markets will be watching most closely and analysing the maximum would be the IT industry.