Shares in Infosys Technologies, India's second-largest outsourcer, rose almost 2 per cent on Friday to a record high on optimism about quarterly earnings next week.
"Infosys is expected to outperform its forecast and upgrade its full-year outlook; plus it is good fundamentally," said Harit Shah, IT analyst with domestic brokerage Karvy Stock Broking.
By 10:41 am, Infosys was up 1.5 per cent at 2,869.40 after hitting 2,879.90, outpacing a 1 per cent rise in the main stock index.
Most analysts expect Infosys, which reports June quarter results on Tuesday, to raise its revenue growth guidance in dollar terms for 2010/11 to 17-19 per cent from 16-18 per cent given in April.
"We expect robust results from Tier 1 IT vendors to demonstrate the underlying demand strength," Macquarie said in a note.
Analysts expect the rupee's 3.3 per cent fall against the US dollar in the June quarter to partially offset the impact of salary hikes and euro volatility for exporters such as Infosys, which generates more than half its sales from the United States.
Shares in Infosys, which has a market value of about $35 billion, currently trade at a price to earnings multiple of 25-27, according to calculation by Reuters.
"The valuation is expensive," said Shah, who has a 'market performer' rating on the stock with a 12-month target of 3,025 rupees.