Infosys, TCS And Tech Mahindra Extend IT Rebound After Brutal Bloodbath

Mumbai, May 19: Information technology stocks extended their rebound for a third session, with heavyweights such as Infosys, Tata Consultancy Services and Tech Mahindra rallying up to 4%, even as the sector’s valuations hover near levels last seen during the 2008 global financial crisis.

Infosys led the gains in the IT pack as bottom fishing fueled rally. Source: NSE

The Nifty IT index jumped 3.5%, outperforming the broader market by a wide margin. Shares of Infosys emerged as the top gainers among frontline IT stocks.They rose 3.89% at Rs 1,186.90. Coforge, LTIMindtree, HCL Technologies, and Persistent Systems also gained. Tech Mahindra rose 3.6% at Rs 1,482. Oracle Financial Services Software and Wipro advanced while TCS increased 2.4% at Rs 2,338.80.

The rally comes after a brutal correction in Indian IT stocks triggered by mounting concerns that rapid advances in artificial intelligence could disrupt the traditional outsourcing-led business model of Indian software exporters. The sector has lost nearly 30% in 2026 so far, with investors worried that AI tools could automate coding, consulting, data analysis and other services that have historically driven revenue growth for Indian IT companies.

Valuations across the sector have consequently compressed sharply with leading IT firms such as Infosys, TCS, HCL Tech and Wipro trading at price-to-earnings multiples of around 15–19 times, levels comparable to those seen during the 2008–09 global financialcrisis.

TCS chose to rally along with others ignoring the pessimism surrounding AI. Source: NSE

Despite the pessimism surrounding AI disruption, bargain hunting and improving sentiment helped fuel Tuesday’s rally. The steep correction has made select IT stocks appear attractive from a valuation perspective, particularly for long-term investors betting that Indian IT firms will adapt to AI-led changes rather than be displaced by them entirely.

A weakening rupee also provided support to export-oriented technology companies. The Indian currency recently hit record lows against the US dollar, a move that typically benefits IT exporters as a significant portion of their revenue comes from overseas markets and is billed in dollars.

Brokerages, however, remain divided on the sector’s outlook. Goldman Sachs maintained a “Neutral” rating on Infosys, citing continued strength in deal wins and opportunities arising from partnerships with AI model companies. At the same time, firms such as Jefferies have warned that AI-led disruption could still trigger further valuation derating in the sector.

Market participants will now closely track management commentary on AI monetisation, client spending trends and large deal wins to assess whether the recent rebound in IT stocks can sustain.

Source:
https://www.nseindia.com/get-quote/equity/INFY/Infosys-Limited, https://www.nseindia.com/get-quote/equity/TCS/Tata-Consultancy-Services-Limited,
https://www.nseindia.com/get-quote/equity/TECHM/Tech-Mahindra-Limited