TCS, Infosys, Wipro Face Downgrades as Indian IT Sector Slides Amid IBM Outlook

Nifty IT Index dropped roughly 1.5% in early trade as flagship stocks TCS, Infosys and Wipro slipped, signaling investor caution after mixed Q1 earnings and a broader market wobble.

CLSA cut its ratings on TCS, Infosys and Wipro, lowering target prices while noting each company’s strong order backlog and expanding AI services, yet the downgrade added pressure to already fragile shares.

IBM outlook spooked the market, causing ADRs of Indian IT firms to tumble up to 7%, and prompting analysts to watch the upcoming India‑UK free trade agreement for potential tariff relief and new export opportunities.

Mid‑cap IT players such as Mindtree and L&T Technology Services emerged as top picks, with analysts citing higher growth rates, better valuation multiples and less exposure to the downgrade cycle, positioning them for a 2% sector rally.