No, I would say. Infosys is not the only share that has corrected in the entire IT space, along with it has crashed TCS, HCL Technologies and Mahindra Satyam shares also and I believe all these 3 names I took are in a better position to invest than Infosys share. Even post this correction, Infosys shares remains higher valued and given the earnings outlook and the disappointment from the company, it is not really a buy according to me. I would better off pay a premium for TCS since atleast they have been consistent in delivering as or above expectations for a while now. But honestly, I would go with something like HCL Technologies or Mahindra Satyam because not just they are doing good in terms of results but they are also much lower valued compared to Infosys or TCS.

Infosys is still trading at 17.5 times of FY12 earnings estimation and that is indeed costly. On the other hand TCS trades at 17 times FY12 earnings estimation. In these two, I would certainly go ahead and pick TCS because the visibility is stronger than Infosys. Now lets compare the other two smaller companies. HCL Technologies trades at 12.6 times FY12 earnings estimation where as Mahindra Satyam trades at 11.4 times FY12 earnings estimates. Now if you look at this recent quarter numbers, Infosys has disappointed where as TCS had delivered as expected and HCL Technologies had beaten expectations by a margin and Satyam’s results was way above expectations, completely unexpected I’d say. Infosys is likely to grow 12-15% this year while TCS would do a 20% and HCL would do a 30% and Satyam’s numbers would just jump up a few times. You might also want to take a look at my view on Infosys Share a while back that I posted.

So in short, If you are really willing to be bold and going to pick IT companies, then go for the companies that are likely to do better in terms of earnings and are also valuation wise much cheaper because when there is a turn around in the market, Im sure that the lower valued better earnings visibility shares will do better and will make you more money. I would say there is no hurry to go and buy in this sector, one can wait and let global things pan out because any kind of slowdown on the global front would hit the IT sector the most. So there might or might not be further corrections, it is better to wait and watch and then take a call after a while.

Related posts:

1. Why I Don’t Prefer Infosys Stock
2. Buy Mahindra Satyam Stock
3. Mahindra Satyam Will Fall On Monday
4. HCL Technologies Is My Top Pick
5. Mahindra Satyam Results