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Shares of IT stocks fell like ninepins in the early morning trade on Wednesday, 22 April, after leading tech firm HCL Technologies' March-quarter results (Q4) and poor management commentary sparked a fresh sell-off in the sector.

IT stocks, already grappling with weak performance due to weak demand concerns and an AI-led scare, crashed up to 10%, dragging the Nifty IT index 3.35% lower to 30,665.35. All index constituents were in the red.

HCL Tech shares emerged as the worst loser with a massive 9.7% decline and were headed for their worst session in eleven years. Other index heavyweights like Infosys, TCS and Tech Mahindra also lost 2-3%.

HCL Tech's FY27 earnings forecast and Q4 results missed analysts' expectations. The company's CEO, C Vijayakumar, said that the weakness in the March quarter performance stemmed from weak discretionary demand.

The revenue fell 3.3% QoQ in CC terms to $3,682 million, missing Streets’ estimate of -1.6% CC growth. EBIT margins fell 200bps sequentially to 16.5%, and also missed Street estimates of 17.5%. TCV, too, was weak at $1.9 billion, down almost 35% YoY.

FY27 services revenue growth guidance of 1.5-4.5% was also below expectations, and now converges its growth differential vs TCS and Infosys, which is likely to lead to convergence of their valuations.

According to a Goldman Sachs report, cited by Reuters, the weak performance and cautious outlook signal sector‑wide challenges with discretionary spending rather than an HCL‑specific problem. The brokerage added that slower project ramp‑ups and macro pressures suggest any demand recovery will remain elusive.

More to come...Saloni Goel has over nine years of experience as a business journalist, with a strong track record of covering the financial markets. Over the course of her career, she has reported extensively on global and domestic equities, IPO market activity, commodities, and broader macroeconomic trends. Her reporting reflects a keen eye for detail, data-driven analysis, and the ability to spot emerging themes early.

At Mint, Saloni has been part of the markets team for nearly two years, where she currently works as Chief Content Producer. In this role, she plays a key part in shaping market coverage, driving editorial strategy, and ensuring timely, accurate, and insightful reporting across. She has been closely involved in breaking news coverage and in crafting stories that help decode the complex financial developments.

Before joining Mint, Saloni worked with some of India’s leading business newsrooms, including The Economic Times and Business Standard. Throughout her career, she has worn multiple hats—ranging from reporting and editing to contributing in-depth features and identifying new storytelling formats and market trends.

Her experience in fast-paced digital newsrooms has given her an edge in simplifying complex market concepts without losing analytical depth. Outside of work, Saloni enjoys reading books and spending time with her pet.

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