India's IT index falls to three-year low on weak earnings outlook, demand worries
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May 12 : India's Nifty IT index tumbled 3.6 per cent on Tuesday to its lowest level since May 2023, as a weak earnings outlook and fears of slowing demand for traditional IT services rattled investors.
Analysts at HSBC said in a Tuesday note that fourth-quarter earnings and fiscal 2027 outlooks from India's top-tier IT firms largely missed expectations, adding that strong global artificial intelligence spending could be "crowding out" spending on traditional IT services.
HSBC's warning comes a day after OpenAI said it is launching a new company backed by more than $4 billion to help organisations build and deploy AI.
In February, global IT stocks saw a rout after Anthropic launched new tools that heightened concerns about AI-driven disruption in the data and professional services industry.
On Tuesday, shares of Indian IT companies including Tata Consultancy Services , Infosys , HCL Technologies and Wipro fell between 2.5 per cent and 4 per cent.
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