Nifty IT index tumbles over 4%; TCS, Wipro, Cyient, Hexaware hit 52-wk lows

TCS, Wipro, Infosys, Coforge, Tech Mahindra, Persistent Systems, HCL Technologies, LTIMindtree and Mphasis were down in the range of 4 per cent to 5 per cent in intra-day trade on Thursday.

Nifty IT index movement today

 

Shares of information technology (IT) companies continued to remain under pressure, with the Nifty IT index falling 4.4 per cent to 33,539.50 on the National Stock Exchange (NSE) in Thursday’s intra-day trade after a sharp sell-off in the frontline stocks. Nifty IT index hit an over four month low, and was trading at its lowest level since October 1, 2025.

 

Tata Consultancy Services (TCS) ( ₹2,782.90) and Wipro ( ₹221.41) were down 4 per cent each, hitting their respective 52-week lows on the NSE in intra-day trade.  Cyient (down 4 per cent at  ₹ 1,018) and Hexaware Technologies (down 3 per cent at  ₹552.50), the non-index stocks, also hit their respective 52-week lows.

 

Infosys, Coforge, Tech Mahindra, Persistent Systems, HCL Technologies, LTIMindtree and Mphasis from the index were down in the range of 4 per cent to 5 per cent in intra-day trade.

 

At 09:30 AM; Nifty IT index, the top loser among sectoral indices, was down 4.2 per cent at 33,628.30, as compared to 0.47 per cent decline in the Nifty 50. 

 

In the past two trading days, the Nifty IT index slipped 6 per cent. Further, in the past seven trading days, IT index tanked 13 per cent.  READ LATEST STOCK MARKET UPDATES TODAY LIVE

Why are IT shares under pressure?

 

The sell-off in American Depository Receipts (ADRs) listed in the US markets continued as fears grew that new AI tools could disrupt businesses.

 

Tech stocks, reeling under the Anthropic shock, are unlikely to recover soon. The sharp dip in the ADRs of top Indian IT companies in the US on Wednesday, indicates that Indian IT will continue to struggle, said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments.

 

Indian IT services stocks followed the global rout in technology/software/consulting and outsourcing stocks. Since February 4, 2026, in the past seven trading days, Nifty IT index has tumbled 13 per cent. 

 

Indian IT stocks were hit hard, amid concerns that AI-native platforms may move up the value chain and automate outsourced work. Global SaaS names such as Salesforce and other enterprise software firms also saw heavy selling as markets priced in faster AI-led disruption to legacy models, ICICI Securities said in a note.

 

While AI workspaces like Claude Cowork signal a shift toward agent-led automation, enterprises still require large-scale integration, governance, data modernization and system orchestration which are areas where IT services firms remain critical, the brokerage firm said.

 

The key catalyst was the Palantir earnings call, which highlighted how the company is upending pay per seat software (workday, ServiceNow, etc.) as well as third-party software with its own AI offerings.  ALSO READ | Tech Mahindra, Infy among top analyst picks as IT stocks continue to slide 

The company also shared a few examples of clients getting rid of third-party software. In addition, Palantir also mentioned that its AI platform was powering complex SAP migration work, compressing the implementation timeline from years to weeks. In addition, Anthropic's entry into automating low-level legal services work and Gartner's muted guidance also had a bearing on sentiment, Motilal Oswal Financial Services (MOFSL) said in a report dated February 4, 2026.

 

While AI's threat to software coding hours was well known, Palantir's comments put ERP implementation into the spotlight, which so far could be considered less impacted from AI's productivity gains, the brokerage firm said, and believe stock reaction again resets the negative sentiment for the sector. 

Meanwhile, the Budget introduces select measures for the IT services industry. Taxing buyback proceeds as capital gains modestly benefits shareholders and could support higher buyback activity.

 

Safe harbor rules have been simplified by consolidating IT services under a uniform 15.5 per cent margin and raising the eligibility threshold to ₹2,000 crore, reducing compliance burden and transfer pricing disputes, particularly for GCCs. 

 

The Budget also enhances the attractiveness of Indian data centers through a tax holiday until FY47 for global cloud providers, supporting demand driven by AI workloads, data localization, and rising cloud adoption, Sumit Pokharna, VP Fundamental Research, Kotak Securities said.  ====================================  Disclaimer: View and outlook shared on the stock belong to the respective brokerages and are not endorsed by Business Standard. Readers discretion is advised.