Understanding IT sector

Not from IT, and except for some very elementary idea, I don’t follow the sector much, nor have I invested for longer duration in these stocks, so take my view with some salt.

I am not sure if Indian IT and US IT stocks can be compared, particularly the FAANG, Microsoft etc. And I think if the R&D that happens does not happen as envisaged in these companies, there is no innovation, competition arises elsewhere, product failures, and if they are trading at high valuations, they will fall, along with the fact that the kind of shorting that happens with US stocks.

Indian IT more or less has the same large caps for the past many years, along with many mid caps, and new age tech companies in the past few years. So one can have a relatively easy view for Indian IT. Sectoral bets have to be taken with some understanding and basis, despite the sector looking like a secular SIP one. Maybe this could be looked at as a defensive sector, provided bought at decent valuations, with the dividends, it could bring some stability to the PF, if one is not into IT. 15% can happen, but as with any other stock, the ride could be a up an down one, and as there are many global factors that influence the sector, the downtime could be long.

I remember having Birla tech fund, also had a position in Nifty IT ETF, couldn’t invest more, so sold my positions, don’t have them now.

Again, not from IT, so could be wrong with some of the points.