Information technology stocks took a beating on the bourses today following revelations that IT majors Wipro and Megasoft too have been barred from doing business with New York-based World Bank.

Wipro was barred for four years beginning June 2007 for "providing improper benefits to Bank staff" while Megasoft was barred for an identical period beginning December 2007 for "participating in a joint venture with Bank staff while also conducting business with the Bank."

Megasoft Consultants Ltd, the US associate of Hyderabad-based Megasoft Limited, said the ban on business with World Bank since 2004 had no financial impact on the company.

Wipro also said a 4-year World Bank ban, imposed some 18 months ago, had not affected its business or operations.

"To date, Wipro's revenue from World Bank is insignificant. Our inability to get future business from World Bank will not adversely affect our business and results of operations," Wipro said in a statement.

According to Wipro, the ban is in connection with its initial public offer of American depository Shares (ADS) programme. In 2000, Wipro offered a commonly utilised and Securities and Exchange Commission-approved directed share programme (DSP) for employees and clients to purchase ADSs at the IPO market price.

"A majority of the shares sold under the DSP were allotted to our employees. Pursuant to this programme, Wipro representatives offered the World Bank, through its chief information officer (CIO), participation in the programme and the CIO directed this offer to members of his family and friends," the Wipro statement added.

The disclosures by Wipro and Megasoft came after the World Bank decided to publish names of all companies that it barred from contracts. The bar applies to companies that provide goods and services directly to the Bank under its current policy for Bank-financed projects in developing countries, it said.

The World Bank Group said the disclosures were part about its corporate procurement programme made in the interest of fairness and transparency.

Shares of Wipro Technologies and Megasoft were in the negative zone registering losses of up to 13 per cent and 12 per cent, respectively, on the BSE.

The Megasoft scrip hit an intra-day low of Rs13.80, while Wipro hit an intra-day low on Rs220 in morning trade.

Satyam Computer, on the other hand, gained following reports that the company is not alone to face a World Bank ban.

Satyam Computer stock surged nearly 60 per cent as investor sentiments improved after government took charge and appointed three members on its board.

The BSE IT index also dipped 4.18 per cent to an intra-day low of 2,042.72 points. The index later rose to 2,082.77 points.

The World Bank also barred non-IT companies like Nestor Pharmaceuticals and Gap International from doing business with it, for violating guidelines.