10/01/2023 11:35 AM | Click to read full article
Valuations in the Indian IT sector are at a crossroads. They may have corrected from their peak but they are not at their historical levels either. TCS, which trades at 25-25.5 times forward multiple, while that may be significantly lower than its peak of 32 times, the average over the last three years, in the pre-Covid era stood at 20-21 times. Infosys trades at around 21.5 times forward earnings, which is a sharp de-rating from its peak of 28 times. However, the historic three-year average multiple for the stock was 17-18 times.