Information Technology (IT) stocks are trading mixed today. Wipro and HCL Tech are among the stocks leading the gainers while eClerx and MindTree are leading the losers. According to the Wall Street Journal, India's leading software firm Infosys is likely to be penalized with a record fine of US$ 35 m over an immigration dispute. The issue pertains to the alleged misuse of business visas (B1 visas) by Infosys. These visas are issued only for the purpose of short term business trips and do not allow employees from taking up employment during their stay in the US. The US Justice Department is will decide if Infosys had sent software engineers on visitor visas, rather than work visas, for onsite work at big corporate clients across the US. In a regulatory filing in June 2011, the company had admitted that any action by the US government against it in this regard would seriously affect its business prospects in the US which is its biggest market. It must be noted that Infosys, in its latest quarterly result (2QFY14), had already set aside an amount of this size as a provision for 'visa related matters' in anticipation of this particular judgment. Infosys is trading flat today.
Engineering stocks are trading mixed today. Manugraph India and KSB Pumps are leading the gainers. Suzlon Energy and Everest Kanto Cylinder are leading the losers. Blue Star is trading flat today. Blue star has delivered subdued performance for 2QFY14 on sales front. The company's revenues grew by 1.3% YoY to Rs 5.8 bn. According to the company; a slow business environment has led to poor revenue booking. The operating profit for the company was up by 12.2% YoY; and EBITDA margin improved by about 0.4% YoY to 3.9%. Improved operating performance was the result of widening distribution reach as well as localization of input costs. Net profit for the company was up by 3.4% YoY. As far as its business segments are concerned, Electromechanical and Packaged air conditioning systems and Cooling Products reported flat growth in sales. Electronics and Industrial Systems which contributes just 7% to the total sales reported 24.7% YoY growth in sales. Also, operating performance of the Electromechanical and Packaged air conditioning systems was disappointing as EBIT declined by about 24.3% YoY.