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Informist, Friday, Oct. 3, 2025

 

MUMBAI – Information technology stocks are expected to see a rebound in the near term, following the sharp correction due to US tariff-related uncertainty, the recent hike in the H-1 B visa fee, and the proposed Halting International Relocation of Employment Act in the US. However, given the rapidly changing macro environment and growing concerns over the US President Donald Trump's policies, the rebound is likely to be limited, and volatility is expected to continue, according to analysts covering the sector.  

 

So far this year, the Nifty IT index has declined by around 22% compared to the 4–5?ll in the benchmark Nifty 50 and Sensex. This week, the index closed 0.7% higher after losing nearly 8% in the previous week. Barring HCL Technologies, Infosys, and Tech Mahindra, all other constituents of the 10-stock index rose on a weekly basis. 
 

The Nifty IT index "found support around its 4-year exponential moving average and settled with a Dragonfly Doji candlestick on weekly charts", Vipin Kumar, assistant vice-president of equity research and senior derivatives analyst at Globe Capital Market, said. "All these are the initial signs of some rebound." Kumar expects the index to find immediate support at 33400 and resistance at 34400-34600 levels next week. 

 

Investors will focus on the September quarter earnings announcements by companies set to kick off on Thursday, with information technology behemoth Tata Consultancy Services and engineering, research, and development company Tata Elxsi. The September quarter earnings of domestic IT companies are expected to remain largely in line with the previous quarter, with little to no change in the demand environment. "We expect a steadier quarter for IT services, with sequential growth of 0.2-6?ross companies," Kotak Institutional Equities said in a report on Wednesday. 

 

"As clients reel under macro and tariff uncertainty, we believe there is hesitation to commit additional dollars to any large initiatives," Motilal Oswal Financial Services said in a report Wednesday, adding that it expects this to be reflected in the September quarter earnings of domestic IT companies. Indian IT companies generate a significant portion of their revenue from US-based clients. The brokerage expects large-cap companies under its coverage to report a 0.3–2.4% sequential growth in revenue in constant currency terms, while mid-cap companies are expected to continue their outperformance with a (-)0.5-6.0% sequential growth in sales.

 

Margins are likely to remain stable or improve for most companies, given delayed wage hikes and rupee depreciation, analysts said. However, analysts expect company-specific headwinds, such as restructuring costs for HCL Tech and deal transition costs for Wipro and Mphasis, to partially offset these margin tailwinds. 

 

In a report dated Wednesday, Nomura Global Markets Research trimmed its growth estimate for revenue in dollar terms for 2026-27 (Apr-Mar) by 50–450 basis points as it builds in higher deflation in renewals due to artificial intelligence-led productivity gains. Nomura also lowered its target multiples by around 10% for large-cap companies as it expects macroeconomic uncertainty to persist.

 

Nomura estimates a 0.2% sequential growth in revenue in constant currency terms and a flat earnings before interest and tax margin for Tata Consultancy Services during the September quarter. Meanwhile, Tata Elxsi is expected to report a 0.6% sequential growth in revenue in constant currency terms and a 60-basis-point sequential improvement in EBIT margin, Kotak said. 

 

TOP HEADLINES

 

* Nomura cuts India IT cos FY27 sales growth view 50-450 bps; target price dn
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* IPO Alert: Capillary Tech gets SEBI nod for fresh issue, OFS
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* Mastek implements Harmony Australasia's human resource with AI-led cloud
* Birlasoft gets Amazon Web Services DevOps competency status
* IPO Alert: XtraNet Technologies files DRHP for INR 1.9-bln fresh issue
* Mphasis gets INR 1.24-bln relief in tax demand from Bangalore tax department
* Zen Tech gets NSE's no-objection for reclassification of promoter Midathala
* Birlasoft board reappoints Angan Guha as MD, CEO for 2 years starting Dec 1
* NCLT approves Happiest Minds' amalgamation with arm Happiest Minds Edutech

 

Following are the resistance and support levels for key IT stocks for next week as per calculations based on their prices on the National Stock Exchange:

 

Company	Price	Week-on-week  change in %	Resistance	Support
COFORGE LTD	1613.10	4.90	1638.40	1575.80
HCL TECHNOLOGIES LTD	1393.50	(-)0.10	1410.60	1371.80
INFOSYS LTD	1446.60	(-)0.20	1457.80	1427.60
L&T TECHNOLOGY SERVICES LTD	4289.70	5.70	4380.60	4121.40
LTIMINDTREE LTD	5120.00	0.90	5183.70	5062.70
MPHASIS LTD	2736.90	3.60	2781.90	2657.50
PERSISTENT SYSTEMS LTD	5068.80	2.40	5156.60	4909.80
TATA CONSULTANCY SERVICES LTD	2901.90	0.10	2938.60	2872.80
TECH MAHINDRA LTD	1400.60	(-)0.50	1433.70	1380.70
WIPRO LTD	240.98	2.20	243.50	236.80
NIFTY IT	33949.75	0.70	34130.70	33672.60
NIFTY 50	24894.25	1.00	25006.10	24691.60
BSE SENSEX	81207.17	1.00	81638.70	80433.80

 

 

End

 

Reported by Arya S. Biju

Edited by Saji George Titus

 

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