Nifty IT climbs 2.6% as large caps rebound ahead Q1

Indian IT stocks advanced on Tuesday, lifting the Nifty IT index by about 2.6% as investors positioned for June quarter earnings, even as a sharp selloff in South Korean chipmakers on AI concerns hit broader Asian technology shares.

The rebound followed steep declines in large-cap IT names over recent months, with the street now focused on whether upcoming results and commentary from firms such as TCS and Infosys can signal demand stability and clarify the revenue impact of artificial intelligence.

Market overview

Index / Segment	Move & % Change	Comments
Nifty IT	approx. +2.6%	Rebounded as large-cap IT stocks gained ahead of Q1 results.
South Korea KOSPI	-395.02 pts (-4.9%)	Fell up to 8.2% intraday as AI-linked chip stocks corrected.

• Infosys, TCS, Tech Mahindra and Mphasis rose up to 4%.
• Infosys gained nearly 4%, TCS advanced about 3%.
• Tech Mahindra climbed around 3.4%, Mphasis added about 3%.
• Wipro slipped 0.4%, lagging the broader IT recovery.
• Early trade saw heavyweight IT stocks drive the Nifty IT index higher.
• Gains came despite weakness in Asian technology shares linked to AI concerns.

Note: figures are approximate; final exchange data not available at time of publication.

Key movers

Top Gainers	Sector	Notable Factor
Infosys	IT services	Rose nearly 4% ahead of June quarter earnings.
TCS	IT services	Gained about 3% as investors positioned for Q1 results.
Tech Mahindra	IT services	Advanced around 3.4% on sector-wide rebound.
Mphasis	IT services	Climbed about 3% amid bargain buying in IT.

Top Losers	Sector	Notable Factor
Wipro	IT services	Declined 0.4% despite broader IT index gains.

• Heavyweight IT stocks lifted the sector index at the open.
• Price action contrasted with declines in Asian semiconductor names.

Sectoral action and valuation reset

Statistic	Value/Change	Context
Market-cap loss, 10 major IT firms	over ₹17 lakh crore	Combined erosion from peak levels across leading IT companies.
TCS share price drawdown	about -56% from peak	From ₹4,592.25 (Aug 2024) to around ₹2,033.
TCS market cap change	from ₹16.48 lakh cr to ₹7.36 lakh cr	Value loss of more than ₹9.12 lakh cr.
Infosys share price drawdown	nearly -50% from peak	From ₹2,006.45 (Dec 2024) to ₹1,006.
Infosys market cap change	from ₹8.30 lakh cr to ₹4.08 lakh cr	Reflects sharp de-rating on AI concerns.

• TCS, Infosys, Wipro and LTIMindtree are down at least 50% from all-time highs.
• Wipro has fallen about 54% from its peak level.
• LTIMindtree has declined more than 53% from its record high.
• HCLTech, Persistent Systems, Mphasis and Tech Mahindra also saw sharp corrections.
• Recent gains are seen as bargain hunting after a prolonged drawdown.

AI concerns and earnings outlook

• Korean chipmakers rallied earlier on AI demand, then corrected on valuation worries.
• Indian IT stocks fell previously on fears AI could hurt billing growth.
• Investors worry AI may reduce manpower-linked revenue in traditional outsourcing.
• There is concern productivity gains may be passed to clients, pressuring pricing.
• Upcoming Q1 earnings and commentary are viewed as critical for sentiment.
• A global brokerage expects a muted first quarter for Indian IT companies.
• The brokerage anticipates subdued guidance for the second quarter.
• It sees risks to FY27 revenue guidance ranges for large-cap IT firms.
• Organic revenue growth for most large caps is projected at 1.5-3.5%.
• Wipro is expected to see a decline in organic revenue, per the brokerage.
• The brokerage downgraded TCS to equal-weight on valuation concerns.
• It noted TCS trades at over a 40% premium to Accenture.
• The premium is seen as putting broader large-cap IT valuations at risk.
• Investors will track if TCS and Infosys can defend margins in Q1.
• Markets also seek clarity on how AI can support revenue, not only cut costs.

Global cues and KOSPI selloff

Market/Asset	Movement	Notes
KOSPI (South Korea)	-4.9% close, intraday -8.2%	Sixth circuit breaker trigger this year on semiconductor volatility.
Samsung Electronics	-6.9% close	Fell over 10% intraday despite strong profit forecast.
SK Hynix	-6.1% close	Also dropped more than 10% intraday on AI valuation concerns.

• KOSPI is down 16% from its 22 June record close of 9,114.55.
• The index remains up about 82% so far this year despite the correction.
• Circuit breakers were triggered as semiconductor stock volatility stayed high.
• Samsung forecast a 19-fold jump in Q2 operating profit.
• The selloff suggests investors question whether AI gains are priced in.
• Indian IT moves reflect a different AI narrative focused on demand and pricing.

Frequently Asked Questions

Why did Indian IT stocks rise while South Korea’s KOSPI fell?

Indian IT stocks gained on positioning ahead of Q1 earnings and bargain buying after steep corrections, while South Korea’s KOSPI fell as AI-linked chipmakers like Samsung Electronics and SK Hynix corrected on concerns that strong AI-driven earnings were already priced in.

How much value have major Indian IT companies lost from their peaks?

Across ten major Indian IT companies, the combined market capitalisation loss from peak levels is estimated at more than ₹17 lakh crore, with TCS alone losing over ₹9.12 lakh crore as its share price fell about 56% from its August 2024 high.

What are the key AI-related concerns for Indian IT firms?

Investors worry that AI could slow billing growth, reduce manpower-linked revenue in traditional outsourcing models, and force Indian IT firms to pass productivity gains to clients, which may pressure pricing and revenue growth despite potential efficiency benefits.