Nifty IT Jumps Over 3% As AI Stock Selloff Globally Turns India's Limited AI Exposure Into An Advantage

The NIFTY IT stocks today bucked broader weakness in the market, with the Nifty IT index rising approximately 3% to ₹30,535.55 at 11:20 am on the National Stock Exchange (NSE), extending its gaining streak to a third consecutive session.

The NIFTY IT stock index has now rallied 15% in July alone against a 0.62% rise in the Nifty 50 and has bounced 18% from its 52-week low of ₹25,699 touched on 1 July.

Coforge led the gains with a surge of around 9%, followed by Mphasis at 5%, while TCS, Infosys, HCL Technologies, Tech Mahindra, Persistent Systems and LTIMindtree each rose approximately 3%.

The Global Trigger

The rally was set off by a sharp selloff in artificial intelligence (AI) and semiconductor stocks across Asian markets. Samsung Electronics and SK Hynix fell as much as 13% to 14%, while Japanese flash memory maker Kioxia dropped nearly 18% and Taiwanese chip designer MediaTek lost over 9%.

The weakness followed a further decline in Nvidia shares on Wall Street after reports suggested the AI chipmaker could provide financial backing for an OpenAI data centre project, raising questions about the sustainability of AI-related capital expenditure cycles.

India's Lack Of AI Exposure Becomes A Strength

For months, Indian information technology (IT) companies were criticised for having limited direct exposure to the AI infrastructure boom that drove chipmakers and AI-focused firms to record valuations. That same characteristic is now working in their favour.

Unlike global technology companies whose earnings depend on continued heavy spending on AI chips, data centres and high-bandwidth memory, Indian IT companies derive most of their revenue from traditional IT services, cloud migration, digital transformation, consulting and enterprise software. This makes them relatively insulated from the risks now surfacing in the AI infrastructure trade, and investors appear to be rotating into them as a more stable alternative.

Coforge Adds Its Own Catalyst

Coforge's strong Q1 FY27 results provided an additional company-specific boost. The company reported organic constant currency growth of 5.2% quarter-on-quarter, well ahead of its broadly flat guidance. Deal momentum was robust, with $691 million in order intake and a record 12-month executable order book of $2.23 billion, up 44% year-on-year. The earnings before interest and tax (EBIT) margin of 16% came in ahead of the 15.5% FY27 guidance.

Analysts noted that with Encora now operationally integrated, a strong deal pipeline and rising AI-led opportunities, Coforge is well placed to sustain industry-leading growth through FY27.

The sector also received support from weakness in crude oil prices, improving domestic market sentiment and attention on the US Federal Reserve's policy meeting, where any positive signals on US corporate spending could further benefit Indian IT demand.

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