Reduce rating for Infosys and HCL Technologies

 Infosys has been downgraded to reduce with a target price of Rs.2000 over one year. The downgrade is on ground that the stock is likely to be available at lower prices than the current prices and it seems prudent to book profit at the current level.

 Many economists see that a recession in the US is very likely and this would adversely affect revenue and profitability of IT companies including Infosys.

 Though the company circles have viewed that near term demand for products and services may not be affected, it has not quantify the medium term impact of the probable recession in the US on the company’s financials.

 In this scenario, the stock price is expected to drop from the current level and the stock may be available cheaper.

 Based on the same reasoning as above, HCL Technology has also been downgraded with a target price of Rs.300 over one year. Currently, the stock is being traded at a price range of around Rs.397.