IT Stocks Tumble Up To 10% As Weak Outlook Rattles Investors

Information technology (IT) shares saw heavy selling on Wednesday morning, with the entire pack trading lower. The sharp fall followed a weak set of numbers from HCL Technologies, which set the tone for the rest of the sector.

At 9:44 am on the Bombay Stock Exchange (BSE), HCLTech shares fell around 10% to ₹1,312.70. Infosys also slipped, losing 2.49% to trade at ₹1,280.40. Tata Consultancy Services edged lower by 1.51% to ₹2,571.15, while Tech Mahindra dropped 2.57% to ₹1,461.75.

The Nifty IT index slipped notably in early trade, as declines were seen across all major names.

HCLTech Earnings Miss And Cautious View

Today’s fall started after HCLTech reported its March-quarter results. The outlook for FY27 also came in weak.

The company expects revenue growth of 1% to 4% in constant currency. That is lower than the 3% to 5% analysts were looking for.

Management pointed to weak discretionary spending. Clients are delaying decisions. There were also two client-specific ramp-downs.

This did not sit well with investors. Many were expecting early signs of a recovery in global tech spending.

On the numbers front, HCLTech reported revenue of ₹33,981 crore and net profit of ₹4,488 crore. Both missed estimates.

New bookings came in at $1.94 billion. That is the lowest in three quarters. It adds to worries around near-term growth.

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Will IT Stocks Continue To Fall?

The next trigger for IT stocks will come from earnings commentary by Infosys, Tata Consultancy Services, and other major players over the next few days.

If peers also give cautious guidance, selling pressure can continue. If management sounds more confident than expected, some of today’s losses can reverse.

For now, the signal from the market is simple. Investors are not focused on last quarter’s numbers. They care more about whether growth can come back in FY27.

Sources:

Livemint

India Today