Except Zomato (up 0.1%), PB Fintech (up 2%), and Fino Payments Bank (up 2.2%), all new-age tech startups under Inc42’s coverage ended today’s session in the red
Nazara Technologies (down 2.2%), Droneacharya (down 2.7%), and RateGain (down 2.9%) were among the biggest losers in the new-age tech stocks in today’s session
The overall IT sector is facing negative sentiment after IT majors TCS and Infosys reported lower-than-expected Q4 numbers last week
Most of the new-age tech stocks declined on Monday (April 17) as the overall stock market ended its nine-session rally, hurt by the poor performance of IT majors Infosys and TCS in Q4 FY23.
Except Zomato (up 0.1%), PB Fintech (up 2%), and Fino Payments Bank (up 2.2%), all new-age tech startups under Inc42’s coverage ended today’s session in the red.
In today’s session, some of the biggest losers were Nazara Technologies (down 2.2%), Droneacharya (down 2.7%), and RateGain (down 2.9%).
Last week, IT majors TCS and Infosys reported lower-than-expected numbers for the fourth quarter ended March 2023 as the macroeconomic headwinds hit their business. As a result, the Nifty IT index plunged 4.7% to 27,008.20 today. While TCS fell 1.6% to INR 3,139.60 on the BSE, Infosys slumped 9.4% to INR 1,258.10.
The disappointing quarter of the tech conglomerates came on the back of a global macroeconomic slowdown. Analysts at Kotak Institutional Equities noted that macro uncertainties and the banking crisis in the US have impacted Infosys’ client sentiment on technology spending.
“The banking crisis in US regional banks and European banks in March 2023 has induced greater caution and could impact the June 2023 quarter. We would not be surprised by a weak US performance across companies that are likely to report in the coming days,” the brokerage added.
Led by the rout in the IT stocks, Sensex fell 0.86% to 59,910.75 on Monday while Nifty50 declined 0.68% to 17,706.85.
It is pertinent to note that new-age tech startups like Nykaa and Zomato have already been seeing weakening of demand over the last few quarters due to rising inflationary pressure, which has dampened consumer sentiment. The macroeconomic downturn impacted market valuation of a majority of tech startups in 2022.
At a time when a majority of the new-age tech companies are aggressively eyeing profitability and looking to tackle the increasing competition, the growing negative sentiment and volatility in the market is likely to impact the stock prices in the near term.
Meanwhile, analysts expect the broader market to remain choppy in the near term.
