Software shares over-valued 8212; TCS

quot;Today there is a growth certainty in the information technology IT sector, hence demand for IT stocks, but a shortage of stocks at the same point of time this is stretching the valuations,quot; Ramadorai said.

India8217;s software stocks have shot to new highs over the past year as the sector feasts on a global appetite for software services. quot;I believe right now the valuations are overheated and a correction is likely.And there will be survivors after the correction,quot; Ramadorai said. TCS is a division of Tata Sons Ltd, a closely held holding company of the Tata Group.

TCS8217;s sales in 1998/99 were Rs 16.52 billion.Ramadorai forecast strong growth for the IT sector. quot;Growth for the IT sector should continue to be very good. Ido not expect any slowdown and the industry should be able to deliver 35-40 percent growth rate this is sustainable.quot;

quot;Growth will be driven by technology applications in sectors like banking, insurance and financial services and e-commerce applications,quot; he said.