Best IT Software Stocks in India for September 2024 Based on 5-Yr CAGR

In FY23, the IT industry contributed 7.5% to India’s GDP, with expectations to reach 10% by 2025. As digital innovations spread across various sectors, India is poised for further IT growth. Known for its vast Internet user base and affordable rates, 76 crore Indians now have online access.

The National Association of Software and Service Companies (NASSCOM) reports that the Indian IT industry’s revenue hit US$ 227 billion in FY22, marking a 15.5% YoY growth. In this article, check the best IT stocks in India for September 2024 based on their 5-yr CAGR.

Best IT Sector Stocks in September 2024 – 5yr CAGR Basis

Note: The best IT stocks list provided here is as of September 6, 2024. The stocks are picked from the Nifty 500 universe and are sorted based on the 5-yr CAGR.

Overview of the Best IT Stocks in September 2024 

1. Bls International Services Ltd

BLS International Services Limited (BLS), a part of the four-decades-old BLS Group with a presence worldwide. The company offers a diversified range of services, and is the biggest global player in visa application outsourcing. For FY 2024, the company reported a total income of ₹1,71,67,628 lakh, up from ₹1,53,74,365 lakh in FY 2023. The company’s profit was ₹32,56,221 lakh in FY 2024, compared to ₹20,42,658 lakh in FY 2023.

Key Metrics:

• Return on Equity (ROE): 27.47%
• Return on Capital Employed (ROCE): 24.44%

2. Persistent Systems Ltd

Persistent Systems offers software engineering and strategic services to help businesses modernize and implement digital solutions. For FY 2024, the company reported a revenue of ₹98,215.87 million, up from ₹83,505.92 million in FY 2023. The company’s profit was ₹10,934.92 million in FY 2024, compared to ₹9,210.93 million in FY 2023.

Key Metrics:

• ROE: 24.51%
• ROCE: 28.81%

3. KPIT Technologies Ltd

KPIT Technologies is a global partner to the automotive and mobility ecosystem, driving the development of software-defined vehicles. For FY 2024, the company reported a total income of ₹49,318.08 million, up from ₹34,052.30 million in FY 2023. The company’s profit was ₹5,985.13 million in FY 2024, compared to ₹3,868.63 million in FY 2023.

Key Metrics:

• ROE: 31.08%
• ROCE: 33.08%

4. Tanla Platforms Ltd

Tanla Platforms Ltd (formerly Tanla Solutions Ltd) is a cloud communications company that empowers businesses to connect with their customers and target audiences. Headquartered in Hyderabad, India, Tanla is a global provider of A2P (application-to-person) messaging platforms. For FY 2024, the company reported a total income of ₹3,97,043.06 lakh, up from ₹3,38,075.41 lakh in FY 2023. The company’s profit was ₹54,831.55 lakh in FY 2024, compared to ₹44,764.86 lakh in FY 2023.

Key Metrics:

• ROE: 31.70%
• ROCE: 34.55%

5. Tata Elxsi Ltd

Tata Elxsi is one of the leading providers of design and technology services in the world. The company offers its services across various industries, including broadcast, automotive, healthcare, transportation and communications. For FY 2024, the company reported revenue from operations of ₹3,552.1 crore, up from ₹3,144.7 crore in FY 2023. The company’s profit was ₹792.2 crore in FY 2024, compared to ₹755.2 crore in FY 2023.

Key Metrics:

• ROE: 34.51%
• ROCE: 39.03%

IT Sector Growth in India

According to the NASSCOM, India’s IT industry generated revenue of US$ 227 billion in FY22, reflecting a 15.5% year-on-year growth. In terms of exports, India’s IT services industry recorded US$ 194 billion in FY23, a 9% growth in constant currency terms, and is expected to hit US$ 199 billion in FY24.

The Indian software product industry is projected to reach US$ 100 billion by 2025, as companies increasingly invest internationally to expand their global footprint and enhance their delivery centers. A report by Infomerics Ratings estimates that India’s IT industry is poised to reach US$ 350 billion by 2026, contributing 10% to the country’s GDP.

Conclusion

In addition to these companies, the Indian IT sector is home to numerous other companies contributing to its growth. Always conduct thorough research before making any investment decisions, and consult with a financial advisor to ensure the best strategy for your financial goals.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.