Kotak Institutional Equities downgrades Infosys TCS LTI Mindtree over risk-reward concerns
Kotak Institutional Equities just downgraded big names like Infosys, TCS, and LTIMindtree after these IT stocks jumped 15% to 35% from their recent lows.
The main reason? Kotak thinks the risk-reward isn't as attractive anymore.
Now, Infosys and TCS are rated "Add" instead of "Buy," with target prices set at ₹1,200 and ₹2,450.
LTIMindtree took a bigger hit, downgraded to "Sell" with a target price of ₹4,150 because its valuation looks too high after the rally.
Brokerages flag pricing pressure and AI
Kotak's move lines up with other brokerages who have been wary about IT lately. They point to tough challenges like pricing pressure and how AI is shaking up the industry.
The Nifty IT index has already dropped 19% this year; Infosys is down 30.7% so far this year, and TCS has lost 29%.
Plus, more clients are turning to newer players like Tech Mahindra and Coforge instead of sticking with the old giants, a trend Kotak is watching closely.