Wipro, Infosys and other IT stocks fall up to 2% as weak TCS results, macro uncertainty weigh on sentiment

Shares of Indian IT majors slid on Monday as investors continued to react to Tata Consultancy Services' (TCS) downbeat revenue performance and guarded outlook, with the broader Nifty IT index falling over 1% to emerge as the day’s worst-performing sectoral index. Wipro, Infosys, HCL Technologies, Tech Mahindra and LTIMindtree declined between 1% and 2%, extending the slide triggered by TCS’s quarterly results released last Friday.

The ripple effects of TCS’s muted June quarter results were felt across the technology sector. Shares of TCS were down 1% on Monday, trading at Rs 3,233.70 on the NSE. Infosys dropped 1.8% to Rs 1,566.50, while Wipro fell 1.2% to Rs 255.15. HCL Technologies declined 1.5% to Rs 1,613.10, LTIMindtree slipped 2% to Rs 5,101.50 and Tech Mahindra was down 1.5% at Rs 1,578.60.

TCS, India’s largest software exporter, reported a strong bottom line and deal wins in Q1 FY26, but its revenue quality and commentary disappointed. The company posted a 3.1% year-on-year decline in constant currency revenue, attributed in part to a “sharp ramp-down in BSNL contracts,” according to Nuvama, which maintained a 'buy' call but lowered its target price to Rs 3,950 from Rs 4,050.

The management’s tone, too, was cautious. TCS CEO K Krithivasan said that “the continued global macro-economic and geo-political uncertainties caused a demand contraction”, although he highlighted “robust deal closures during this quarter.” He added that the company is supporting clients “through cost optimization, vendor consolidation and AI-led business transformation.”

Despite the $9.4 billion total contract value (TCV) for the quarter, up 13.3% YoY, investors focused on the company’s soft sequential revenue and uncertain near-term demand.

Brokerages pare estimates amid caution

Brokerages responded by trimming their expectations. Antique retained its ‘buy’ rating on TCS but lowered its target price by 3% to Rs 3,725, citing “near-term pressures”. It cut FY26 and FY27 EPS forecasts by 2–3%, but said the “inexpensive valuation provides a good entry point for long-term investors.”

Motilal Oswal also held its ‘buy’ stance with a price target of Rs 3,850, but flagged that “most of the Q1 revenue decline was led by BSNL, but international business also slipped 0.5% amid macro uncertainties.” It added that execution of BSNL’s pending Rs 2,900 crore order “remains unclear,” and while margins improved 30 bps sequentially, “revenue conversion remains a challenge as productivity gains weigh on topline growth.”

Nuvama expects international growth to recover once macro headwinds abate but has also trimmed FY26/27 EPS estimates by up to 3%.

Analysts brace for further volatility

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that “Nifty has been exhibiting a weak trend weighed mainly by the weakness in the IT stocks. This weakness may persist particularly since the FIIs were big sellers in the cash market last Friday.”

As TCS opens the earnings season for India’s software exporters, investors are bracing for similar signals from other IT majors. For now, weak global cues, revenue softness, and subdued commentary appear to have set the tone.

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