Understanding IT sector

Agree with @gsapte & @Investor_No_1. Like you guys I was the founder of a Healthcare IT company for 2 decades.

You both covered PE and other aspects in length.
Let me give you some data of stock returns and retail holdings
CAGR stock Returns for
HCL – 10 Y @ 21%; 3 Y @ 22%
Infosys – 10 Y @ 17%; 3 Y @ 25%
Similar for other large caps and better for many mid caps. Source: Screener.

Public & FII shareholding for
HCL public 5.5%, FII 18%
TCS public 5.8% vs FII 13.5%

In 10 yrs TCS gave return of 3.73x, Infy 3.76x and HCL 5.48x
Those return one got without any PE re-ratings, as indicated by gsapte PE of HCL 10 yrs vs now is 16.3 vs 19.7. with Dividend Y of 3.74% HCL is no brainer for me (check disclosure)

I have the same view – PE won’t go down much but the chances of getting the same return in 3,5,10 yrs are bright. – Data proves it.

Am feeling pains when a relative child working at TCS for 5 yrs, he and his father was holding Bob, ONGC etc but not TCS.

I was going through Diwali pick by 7-8 MF, only 2 have one IT share in each (One has TCS and other has LTTS). This is painful. It seems FII is taking advantage of the IT services sector where retail is left for looking for multibaggers in other sectors.

Disc: Invested in TCS, Infy, HCL, KPIT & LTTS since covid and before that. Currently IT services is 35-40% of PF. No recent transactions. Views are biased.