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  1. LTIMindtree, Tata Elxsi, Tata Technologies at 52-week lows amid IT sector downturn

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LTIMindtree, Tata Elxsi, Tata Technologies at 52-week lows amid IT sector downturn

Upstox

3 min read | Updated on March 17, 2025, 13:11 IST

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SUMMARY

The NIFTY IT index has resumed its decline after a one-week pause, forming a bearish candle on the weekly chart. It is trading below the 21- and 50-week exponential moving averages (EMAs), indicating persistent weakness in the broader trend.

IT stocks Infosys, Wipro, TCS, HCL Technologies and LTI Mindtree lost between 2% and 7% last week. | Image: Shutterstock

IT stocks Infosys, Wipro, TCS, HCL Technologies and LTI Mindtree lost between 2% and 7% last week. | Image: Shutterstock

NIFTY IT was the biggest sectoral loser last week, falling 4.49% amid global uncertainty after U.S. President Donald Trump imposed several import tariffs. NIFTY IT touched an 8-month low as domestic IT companies came under heavy selling pressure. On Monday, the NIFTY IT index continues to trade lower, down 0.48%.

IT stocks Infosys, Wipro, TCS, HCL Technologies and LTI Mindtree lost between 2% and 7% on fears of an economic slowdown and a possible recession in the U.S. economy. The escalating global trade war and weak U.S. economic data could impact U.S. companies' sales, leading to lower revenues and a reduction in IT spending. This would result in fewer orders for domestic IT companies.

Stocks in focus

  • LTIMindtree's break below its 200-week exponential moving average (EMA) and the decisive breach of the May 2022 trendline on the weekly chart highlight the weakness. A 5% weekly decline, coupled with the breaching of key support zones, underlines the potential for a reversal in the stock's long-term trend.
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  • Tata Elxsi's attempted rebound failed, with the stock resuming its downtrend and closing the week down over 6%. Trading below its 21, 50, and 200-week EMAs confirms the stock's weak broader trend. Immediate resistance is observed around ₹6,200, while crucial support lies near ₹4,300.
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  • Coforge slipped below it 50- week EMA and formed an inside candle on the week chart. It is currently consolidating between the ₹8,006 and ₹7,098 and a break of this range on the daily closing basis will provide further directional insights.
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Bearish outlook on LTIMindtree, Tata Elxsi and Coforge

If you expect a sustained bearish trend in LTIMindtree, Tata Elxsi and Coforge in the long-term, a long-put strategy can be considered. Let's break this down using Coforge as an example.
Coforge closed at ₹7,292 on Thursday, and the ATM (at-the-money) strike is 7,300. If you buy an ATM put of March 27 expiry, the breakeven for this strategy will be ₹7,107, which is 2.5% from the closing price of Thursday. If Coforge slips more than this, then the strategy will be profitable.

Disclaimer

Derivatives trading must be done only by traders who fully understand the risks associated with them and strictly apply risk mechanisms like stop-losses. The information is only for educational purposes. We do not recommend any particular stock, securities and strategies for trading. The stock names mentioned in this article are purely for showing how to do analysis. Take your own decision before investing.

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About The Author

Upstox
Upstox News Desk is a team of journalists who passionately cover stock markets, economy, commodities, latest business trends, and personal finance.

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