MUMBAI: Information technology stocks fell by as much as 3 percent after Cognizant Technology Solutions Corp. lowered its full year revenue guidance to at least 14 percent from 16.5 percent earlier, indicating that the sector may face some challenges ahead.
Shares of top IT services providers Tata Consultancy Services Ltd (TCS) and Infosys Ltd fell by 2 percent each on BSE.
Wipro lost 2.86 percent, while HCL Technologies Ltd went down by 2.19 percent and Hexaware Technologies Ltd 1.27 percent.
Cognizant had on Wednesday reported a healthy 24 percent jump in net profit at $371.9 million for the quarter ended 30 June, but struck a cautious note as it lowered the full year revenue guidance.
“Due to weakness at certain clients and longer than anticipated sales cycles for certain large integrated deals, we are adopting a more conservative stance for the remainder of the year and revising our 2014 revenue guidance to growth of at least 14 percent over the prior year,” Cognizant CEO Francisco D’Souza had said.
The New Jersey-based firm, which has big operations in India, also expanded its stock repurchase programme by $500 million to $2 billion.
In India, it has global delivery centres in Mumbai, Bangalore, Chennai, Coimbatore, Gurgaon, Hyderabad, Kerala, Kolkata and Pune.
Overall, the company’s revenue for the second quarter of 2014 rose by 16.5 percent to $2.52 billion, from $2.16 billion a year ago.
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