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Following four consecutive sessions of decline, the Nifty IT index recovered on Tuesday, July 15, rising almost 1 per cent intraday with renewed interest among investors. At 11:20 AM, the index was quoting at 37,582.30, higher by 0.8 per cent, with the majority of constituents quoting in the green except HCL Technologies, which was still under pressure after weak earnings.

Bargain buying lifts IT heavyweights

The rebound was capped by the lead IT stocks like Infosys, Wipro, and LTIMindtree, each of which gained up to 2 per cent. The rally was registered even as concerns of subdued tech demand and conservative Q1 commentary by top companies persisted. Analysts opine that investors were quick to take advantage of the recent sell-off in largecap tech counters, which brought forth a wave of value buying.

Cooling inflation and encouraging overseas cues also helped the sector-wide recovery, keeping overall market sentiment positive.

HCL Tech underperforms with 10% fall in profit

While all other IT names moved ahead, HCL Technologies was the only laggard, dropping 4 per cent intraday. The decline followed its Q1FY26 earnings announcement that reported a 10 per cent YoY fall in net profit to Rs 3,843 crore from Rs 4,257 crore in Q1FY25. This was despite revenue from operations rising by 8 per cent to Rs 30,349 crore.

The crisp miss. on profitability jolted investor confidence, leaving HCL Tech a sole outlier in an otherwise upbeat day for the IT index.

What seeded the rebound?

Attractive valuations: The recent correction in IT stocks served as a buying opportunity for long-term investors.

Cooling macro worries: Softening inflationary pressures enhanced risk appetite all around.

Selective optimism: Although Q1 results were mixed, IT firms such as Infosys and Wipro were observed to be performing relatively better, encouraging selective buying.

Company-by-company snapshot

Infosys: Surged up to 2 per cent; one of the major reasons behind the index turnaround.

Wipro: Joined the rally with hard-hitting gains; value buying was instrumental.

LTIMindtree: Jumped up to 2 per cent, uplifting sentiment in the midcap IT group.

TCS: Recovered from last week's post-results sell-off; bottoming out signs.

HCL Tech: Fell 4 per cent following weak quarterly results, dampening overall mood.

Sector outlook

Even though Tuesday's rebound, analysts are still divided about the short-term prospects for IT. Sustained demand weakness in BFSI and poor discretionary spends in critical geographies continue to constrain revenue visibility for large companies. Nevertheless, long-term investors can possibly view present levels as good entry points in individual stocks with strong earnings profiles.

The Nifty IT index may have found near-term support after a brutal sell-off, but stock-specific performance, especially quarterly results, will remain the key trigger in this volatile phase.

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