Nifty IT gains 3% after strong HCLTech earnings report

what happened

Indian information technology shares rose sharply on Tuesday, Moneycontrol reported, after HCL Technologies delivered strong quarterly results, AI revenue accelerated and new deal wins improved sentiment. The Nifty IT index climbed 3.03% to 29,208.20, the best performance among sectoral gauges. TCS advanced 5.12% to Rs 2,233.70, while HCLTech gained 3.70% to Rs 1,268.20. Tech Mahindra added 2.75% to Rs 1,511.40 and Infosys rose 2.08% to Rs 1,041.25.

HCLTech posted consolidated net profit of Rs 5,132 crore for the July-September quarter, a 21.2% year-on-year increase. Revenue rose 11.5% to Rs 35,620 crore, while operating margin widened to 18.2%. Advanced AI revenue jumped 78% year-on-year to $219 million, and net new deal wins reached $3.24 billion, including a $1.14 billion AI contract from Mercedes-Benz. The company raised the lower end of its FY27 revenue-growth guidance to 2.5% from 1%, kept the upper end at 4% and maintained its margin outlook at 17.5-18.5%.

The advance in Indian IT stocks contrasted with a wider technology selloff in Asia, driven by concerns about stretched AI valuations, heavy investment and the durability of AI-led growth. MSCI’s broadest Asia-Pacific index excluding Japan fell 2.4%, South Korea’s KOSPI dropped 6%, Japan’s Nikkei declined 2.6% and Taiwan’s benchmark lost 2%.

why it matters

HCLTech’s figures reinforced expectations that established Indian IT services companies can capture more enterprise AI spending. At the same time, weaker global AI shares could reduce competitive pressure on traditional IT providers, while brokerages remain divided on HCLTech’s valuation and the durability of a broader demand recovery.

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