Indian IT stocks are undergoing a significant correction, with the Nifty IT Index hitting a 30-month low of ₹28,530 on April 24, 2026. The sector has faced selling pressure due to concerns over AI disruption and broader foreign institutional investor (FPI) selling.
The brokerage outlook for Indian IT stocks in late April 2026 is cautious and selective, primarily due to conservative FY27 revenue guidance and the disruptive potential of AI. While major brokerages have slashed price targets for some, they remain “overweight” or “buy” on others, citing attractive valuations after the recent correction.
Brokerage Ratings & Targets (April 2026)
The brokerage outlook for Indian IT stocks in late April 2026 is cautious and selective, primarily due to conservative FY27 revenue guidance and the disruptive potential of AI. While major brokerages have slashed price targets for some, they remain “overweight” or “buy” on others, citing attractive valuations after the recent correct
Brokerage Ratings & Targets (April 2026)
| Company | Brokerage | Rating | Target Price (₹) | Key Reasoning |
|---|---|---|---|---|
| TCS | Morgan Stanley | Overweight | 2,880 | Strongest execution among peers; $12B TCV order book. |
| Infosys | Jefferies | Slashed | 1,450 | “Shocked” by weak FY27 guidance (1.5–3.5%); AI deflation risks. |
| Infosys | Nomura | Buy | 1,600 | Retains as “Top Pick” despite cautious guidance; sees long-term AI upside. |
| HCL Tech | Motilal Oswal | Buy | 1,650 | Diversified infra-heavy portfolio seen as a structural positive. |
| Wipro | HDFC Securities | Add | 225 | Underwhelming guidance; specific client issues in Americas. |
Key Thematic Concerns
- AI Transition Pressure: Brokerages like Jefferies are flagging “AI deflation,” where automation might reduce the billing hours for traditional routine IT services.
- Earnings Downgrades: JPMorgan recently downgraded the Indian equity market to “neutral,” citing high valuations and a 2–10% cut in FY27 earnings estimates across sectors, including IT.
- Guidance vs. Reality: The conservative growth outlook (0–3.5% for most) has reset the sector’s trading multiples lower. However, Morgan Stanley argues these fears are overstated as India shifts toward higher-skill AI role
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