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Indian IT stocks witnessed a sharp decline following developments around US-based artificial intelligence company Anthropic, market expert Ajay Bagga said in a conversation with Zee Business Managing Editor Anil Singhvi.

Today, IT stocks saw sharp losses, hitting both prices and market caps. Wipro fell 3.79 per cent, reducing its market cap by 9,286 crore to 2,45,000 crore. Oracle Financial Services Software dropped 4.06 per cent, losing 2,652 crore from 65,342 crore.

Tech Mahindra declined 4.52 per cent, shedding 7,277 crore of its 1,61,000 crore market cap. HCL Technologies fell 4.58 per cent, down 20,110 crore from 4,39,000 crore. Mphasis dropped 4.59 per cent, losing 2,346 crore from 51,133 crore.

Persistent Systems declined 4.76 per cent, down 4,417 crore from 92,795 crore. LTIMindtree fell 5.84 per cent, shedding 10,337 crore from 1,77,000 crore. Coforge dropped 6.02 per cent, losing 601 crore from 9,985 crore. TCS fell 6.99 per cent, losing 75,911 crore from 10,86,000 crore.

Infosys declined 7.37 per cent, down 46,917 crore from 6,37,000 crore. Total market cap loss for these IT stocks today was 1,79,854 crore.

Bagga explained that Anthropic has created advanced AI tools capable of writing software code. "The scale at which these tools can work is unprecedented," he said. "They can analyse huge amounts of data and provide outputs in minutes, which could affect traditional IT business models."

He added that while the AI tools may improve productivity, their adoption poses risks. "If you are a bank, retailer, or a large company, you cannot rely entirely on AI software whose accountability is not clear," Bagga said. "Companies like Infosys, TCS, or Oracle remain the industry standard because they provide products with clear responsibility and support."

Bagga said he consulted several senior industry figures, including promoters of Infosys and other US-based experts. He noted that although some AI tools are attracting attention, IT companies are unlikely to lose their core business immediately. "There will be disruption, but applications will still be developed and serviced by established IT companies," he said.

Discussing Anthropic’s valuation, Bagga said the company is estimated at 29 billion dollars, while other AI companies like OpenAI are valued at over 500 billion dollars. "The technology is moving fast, and several AI IPOs are expected in the near future," he said.

He also highlighted some limitations of AI tools. "When I tested them, I found they sometimes provide outdated or incorrect data," Bagga said. "They are not fully reliable yet for critical business decisions."

Bagga stressed that while AI tools like Anthropic’s and others, such as Cursor or Gemini, can code efficiently, companies are cautious about deploying them for core operations. "Even if these AI tools are fast, their mistakes can have serious consequences," he said.

On the global AI landscape, Bagga said China has also launched numerous AI companies, and Elon Musk merged his AI venture with SpaceX’s technology division, creating a paper valuation of 1.25 trillion dollars. "The competition is intense, and the speed of innovation is very high," he said.

Bagga further warned of the long-term implications of AI. "Experts are talking about the possibility of AI reaching human brain-level processing within a few years," he said. "While scenarios like machines taking control of critical systems are hypothetical now, the pace of AI development is remarkable."

He added that experiments have shown AI can act autonomously, making decisions to protect itself or optimise operations. "These are controlled experiments, but they highlight the challenges of managing advanced AI systems," Bagga said.

Bagga concluded by saying that while the hype around AI is significant, companies and investors should carefully assess both opportunities and risks. "Disruption will happen, but IT companies still have the experience and accountability that AI startups cannot replace immediately," he said.

Nifty IT fell sharply on Wednesday, closing at 36,345.65, down 2,266.10 points or 5.87 per cent. The index opened at 37,165.35, touched an intraday high of 37,176.70 and a low of 35,809.50. The total traded volume stood at 8,45,99,812 shares, with a turnover of Rs 12,554.72 crore.

Nifty IT remains below its 52-week high of 43,133.35 and above the 52-week low of 30,918.95. The sector saw heavy selling pressure, erasing recent gains.