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Informist, Friday, May 22, 2026

MUMBAI – Information technology stocks may see some gains in the upcoming week, though the extent of the rise is seen limited amid no major fundamental changes, according to analysts. After their recent sharp fall, these stocks staged a slight recovery this week, which is seen spilling over to next week as well, they said. 

The Nifty IT index gained over 4% this week, recovering most of the around 6% it lost in the trailing week. The index, however, may not see as much a rise in the coming week, said Om Mehra, technical and derivatives analyst at Samco Securities. He expects the sectoral index to find support at 28000-28200 points and resistance at 29700-30000 points next week. On Friday, the IT index closed at 28912.45 points, slightly lower than Thursday. 

Earlier this week, JM Financial Institutional Securities in a report said that the demand outlook, particularly after the March quarter earnings, led to a weaker-than-expected FY27 outlook. The brokerage now expects revenue in constant currency terms of top 10 domestic IT companies to be around 3% in 2026-27 (Apr-Mar), compared with around 4% growth it expected at the start of the quarter. It also noted that the FY27 revenue guidance by the companies was softer than expected given continued macroeconomic  uncertainty, artificial intelligence-led revenue deflation, and heightened competition in the industry. 

However, FY27 estimates for earnings before interest and tax of these companies were raised by 1.1% since the beginning of April largely due to the sharp depreciation of rupee against the dollar. Depreciation of the rupee is good for domestic IT companies which earns a major part of their revenue from US-based clients. "Order book growth has been decent for large Indian IT companies in FY26 versus FY25; however, Cognizant's comment on higher deal duration needs to be monitored," JM Financial said.     

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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

Reported by Arya S. Biju

Edited by Akul Nishant Akhoury

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