On Friday, huge buying was seen in IT sector shares in the stock market. Shares of many leading IT companies including Infosys, TCS, HCL Tech and Tech Mahindra rose by 3%. The biggest reason for this rise was Tech Mahindra’s better than expected results for the first quarter (Q1) of the financial year 2026-27. After the better performance, the brokerage houses praised the company, due to which the environment of the entire IT sector became positive.
Infosys shares rose by about 3.3% to Rs 1,117. A rise of 3% was recorded in HCL Tech and 3.4% in Tech Mahindra. TCS shares also rose by about 2.5%. Apart from this, Persistent Systems also saw a growth of more than 1%. However, Wipro shares fell more than 3% due to weak quarterly results. Due to this rise, Nifty IT index also increased by 2.3% to reach 29,381 points.
Brokerage houses are bullish on Tech Mahindra
According to global brokerage Nomura, Tech Mahindra has performed better than expected in the first quarter. The company’s dollar earnings (on a constant currency basis) grew more than expected, while operating margins were also better than expected. The brokerage says that the company’s margins have improved due to Project Fortius and the weakness of the rupee.
Nomura has increased the target price of Tech Mahindra from Rs 1,400 to Rs 1,600. Nuvama has also maintained the ‘Buy’ rating and increased the target price to Rs 1,800 in view of the company’s strong orders, better margins and growth. Motilal Oswal believes that if the company continues at this pace, its growth can be better than other big IT companies in the coming years.
HCL Tech got a big contract of 7 years
The second major reason for the rise in IT shares is the new international contract won by HCL Tech. The company has extended its seven-year partnership with Guardian Life Insurance Company of America. Under this agreement, HCL Tech will modernize the company’s technology and business operations with the help of Artificial Intelligence (AI). The market believes that such big deals will strengthen the company’s earnings and profits in the coming times.
Wipro results raise concerns
While Tech Mahindra pleased the market, Wipro’s weak quarterly results disappointed investors. The company’s earnings and second quarter estimates were weaker than expected. After this, both Nomura and Nuvama cut the target price of Wipro. However, both the brokerages have maintained ‘Buy’ rating on the stock.
IT sector still faces challenges
Experts say that despite the recent growth, many challenges remain before Indian IT companies. Slowdown in global IT spending, declining discretionary spending power of customers, rising employee costs and increasing use of AI are putting pressure on traditional outsourcing businesses. In such a situation, the growth and new orders of companies will be most important in the eyes of investors in the coming quarters.
Leave a Reply