Indian IT stocks down 50% from peak: Time to buy?
What's the story
India's top IT companies, including Tata Consultancy Services (TCS) and Infosys, have seen their market capitalization drop by over 50% from their peak. The decline has wiped out nearly ₹19.28 lakh crore in combined market cap across 10 major IT firms from their peak values. TCS and Infosys are currently trading at their lowest levels since 2020.
Market impact
TCS down 56% from its all-time high
TCS has been hit the hardest with its stock crashing some 56% from an all-time high of ₹4,592.25 on August 30, 2024. The company's m-cap has fallen from a peak of ₹16.47 lakh crore to ₹7.35 lakh crore, erasing over ₹9.12 lakh crore in wealth. Infosys's stock has also lost nearly half its value since the peak of ₹2,006.45 on December 13, 2024 to current levels of ₹986 per share.
Additional losses
Wipro, LTI Mindtree also suffer huge losses
Other major players in the Indian IT sector have also witnessed huge losses. Wipro's stock has fallen 54% from its peak of ₹369.93 on October 14, 2021, to current levels around ₹170.35 per share. LTIMindtree's stock has declined over 53% from an all-time high of ₹7,588.80 on January 4, 2022, to current levels around ₹3,543 per share.
More declines
Other IT firms also face market challenges
HCL Tech's stock has fallen 47% from its January 2025 peak while Persistent Systems is down 36%. Mphasis has corrected by 41% and Tech Mahindra, which hit its all-time high as recently as February 3, 2026, has already fallen 24%. The decline in these companies' stocks further highlights the ongoing market slump in India's top IT sector.
Market drivers
Macroeconomic stress, AI disruption driving market correction
The ongoing market correction in India's top IT sector is being driven by macroeconomic stress in North America and the disruptive potential of generative artificial intelligence (AI). Analysts have warned that these structural changes, coupled with a cautious global economic outlook, could lead to further de-rating of the sector. The impact of high inflation and aggressive monetary policy in the US on enterprise spending has also contributed to this trend.
Industry threat
Generative AI's threat to Indian IT firms
The rise of generative AI is rapidly automating coding, customer support, and back-office processes. This development directly threatens the traditional labor-arbitrage model employed by major Indian IT firms. DBS Bank has warned that AI disruption is now most visible in India's large IT services and outsourcing sector. The potential impact of this technological shift on these companies' business models remains a key concern for investors.