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Informist, Friday, Apr. 10, 2026

MUMBAI – Shares of information technology companies are expected to move in a range with a negative bias next week. Expectations of a soft earnings performance in the March quarter will likely hurt stocks of IT majors, several of whom are slated to release their quarterly figures in the next couple of weeks. Analysts pointed towards artificial intelligence-related weakness surfacing again, but said that sell-offs sparked by fears of AI tools hurting contracts meaningfully are knee-jerk reactions.

This week, the Nifty IT index rose almost 2% to close at 31030.60 points. The index had recently broken above 31200 points, but quickly gave up its gains, indicating signs of selling at higher levels, Rupak De, technical analyst at LKP Securities, said. "If the index manages to sustain over 29000 (points) in the next 15–20 days, we may see another leg of rally to 33000 points," he said. On the lower end, a deeper correction to 25000–26000 points is likely if the index cannot hold above the key level, the analyst said.

Domestic IT services companies are expected to report soft results as demand remained largely unchanged in the March quarter, according to analysts. There has been some improvement in discretionary tech spending in banking, financial services, and insurance and technology verticals. Verticals such as manufacturing, automotive, and communications remain weak, Centrum Broking said. Brokerages are unanimous in their view that mid-cap IT players are likely to once again report better revenue growth compared with their larger peers.

Tata Consultancy Services was the first among IT majors to report its figures for the March quarter. The company this week reported a sharp sequential growth in its bottom line. Brokerages were mostly positive about the results and said it indicated a recovery in demand. However, the company reported a 2.4% decline in revenue in constant currency terms for 2025–26 (Apr-Mar). It also reported a 0.5% year-on-year decline in dollar terms in revenue growth to $30.08 billion. This is the first time it has reported a decline in revenue in dollar terms since it went public in 2004, according to several media reports. Shares of the company ended 2.5% lower at INR 2,524.30 on Friday.

The fall in IT stocks on Friday is also attributable to Anthropic's preview of its new model, Mythos, a tool used to protect against cybersecurity vulnerabilities. In some cases, it has identified bugs that remained undetected for decades despite multiple testing cycles, Motilal Oswal Financial Services said. Mythos builds on big gains in capabilities on Opus which was released in February and sent most software-as-a-service stocks tumbling. However, the brokerage added that it does not see a big hit for IT stocks because of this development and said multiple partnerships with AI players will help IT companies transition to an AI services model in the medium-to-long term.

TOP HEADLINES

* Analyst Concall: Entering FY27 with confidence regarding orders, says TCS
* Earnings Review: TCS Q4 PAT surges sharply on qtr, misses view by a whisker
* Wipro to consider share buyback at board meeting on Apr 15-16
* Persistent Systems launches AI-powered fraud detection solutions
* Coforge launches delivery model AI Mod Squads on fixed monthly subscription
* Earnings Outlook: TCS Q4 adjusted PAT seen down QoQ despite rise in revenue
* Cyient completes purchase of 74% stake in US semiconductor firm for $85 mln
* Infosys partners with Harness to boost AI-led software delivery capabilities
* Coforge promotes Sunil Fernandes to COO position with immediate effect
* FSN E-Commerce pegs Q4 consol net revenue growth at 12-qtr high
* Wipro gets 8-year deal from Olam Group with contract value of over $1 bln
* Earnings Outlook: IT cos may post poor Q4 PAT show despite sales rising QoQ

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:

End

US$1 = INR 92.72

Reported by Eshitva Prakash

Edited by Ashish Shirke

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