Wipro, Infosys, LTTS, Mphasis: IT stocks rally, NIFTY IT index up 1% amid positive global cues; what experts say on sector outlook

All the 10 constituents of the NIFTY IT index were trading in the green. The NIFTY IT index was trading 1% higher at 36,595.90 levels.

Among individual names, shares of Wipro were trading 2.52% higher at ₹272.40 apiece on the NSE, while Tech Mahindra was up 1.25% at ₹1,413.60. Infosys was up 2.29% at ₹1,622.85.

On Wednesday, the Federal Reserve kept rates unchanged as widely expected. The US central bank kept its benchmark overnight interest rate unchanged at 4.25%-4.50% and indicated that two quarter-point interest-rate cuts were likely later this year, the same median forecast as three months ago.

These software firms are showcasing the solutions leveraging Nvidia technologies at the US-based chip major's ongoing annual GPU Technology Conference (GTC) in California.

Tech Mahindra has unveiled an autonomous pharmacovigilance (PV) solution powered by Nvidia AI software to enhance drug safety management. By leveraging agentic AI and automation, the solution improves the speed, accuracy, and efficiency of PV processes, addressing challenges like manual delays and data overload.

IT stocks: What is the latest trend?

The domestic stock market has shown an impressive rebound in the past three sessions (March 17-March 19), with the majority of the stocks across market capitalisations and sectors witnessing healthy demand from investors.

However, one sector that has failed to participate in the market rally is IT.

Data show that the NIFTY IT index has fallen 11.48% in the past 30 days (from February 19, 2025, closing to March 19, 2025, closing). Further, the index has fallen over 16% in 2025 alone.

The slide in the stocks, as per experts, is mainly due to expensive valuations despite the fall as well as global macro uncertainty.

In its latest note, Citi, the global investment bank and financial services company, has said that downside global headwinds, poor US macroeconomic fundamentals, and high valuations have made the sector investors risk off.

Besides AI disruption, GCC trends, etc., are other headwinds for the sector.

As AI becomes the backbone of the digital economy, Global Capability Centres (GCCs) are emerging as global hubs for AI-driven innovation. Enterprises are increasingly relying on GCCs to source, develop, and deploy AI talent to enhance operations and create competitive advantages, according to an article by ANSR, a global firm specialising in the establishment of GCCs, also known as Global In-house Centres.

According to news reports, Citi has flagged high valuations, with the index at 24 times one-year forward earnings, even as demand slows and margins are under pressure. The firm is cautious of the sector, stating that margins will be difficult to improve even with the rupee at record lows.

Citi expects revenue growth in FY26 to be around 4%, similar to what it has estimated for the ongoing fiscal year FY25.

The firm added that the companies' margin improvement in a competitive environment is not easy despite a depreciation in the rupee.

It further said that it continues to like HCLTech and Infosys in the large-cap space.