Indian IT stocks 2026: brokers cut targets, ratings

What changed for Indian IT stocks

Brokerage calls on Indian IT services turned more mixed after a series of target cuts and rating changes across large and mid-cap names. JPMorgan downgraded HCL Technologies, Wipro and Tata Technologies to Underweight from Neutral and reduced target prices for all three. Kotak Institutional Equities lowered earnings forecasts and fair value estimates for multiple IT companies, warning that fast adoption of generative AI could pressure the sector’s long-term growth trajectory. Jefferies also trimmed targets and downgraded several stocks, arguing AI may structurally change the business mix. At the same time, some domestic brokerages kept a selective “buy” stance on a few names such as TCS, Infosys, Tech Mahindra, LTIMindtree and Persistent.

JPMorgan downgrades: HCL Tech, Wipro, Tata Technologies

JPMorgan’s move was explicit on ratings and targets. It downgraded HCL Technologies, Wipro and Tata Technologies to Underweight from Neutral. The brokerage lowered HCL Tech’s target price to Rs 1,000 from Rs 1,370. It cut Wipro’s target price to Rs 160 from Rs 200. And it reduced Tata Technologies’ target price to Rs 540 from Rs 560.

JPMorgan also flagged it was staying selective within the sector. Its preferred IT picks included TCS, Infosys, Tech Mahindra, Coforge, Persistent Systems and Sagility India. The framing suggests JPMorgan is differentiating between companies it believes can navigate shifting demand better and those where it sees weaker risk-reward.

Nifty IT and constituent performance in 2026

The broader market backdrop for IT has been weak in 2026 based on the numbers cited. The Nifty IT index slipped 24% in 2026. Among constituents, TCS was down 33%, HCL Technologies fell 30%, Infosys fell 27%, Wipro slipped 31% and Tech Mahindra lost 7% in 2026.

In a separate market move referenced, several IT names advanced over 1% in a session, including Coforge, Oracle, HCL Tech, Tech Mahindra, LTIMindtree, Wipro and TCS. The combination of large year-to-date declines and sharp single-day moves highlights how sensitive the sector has been to incremental news flow, brokerage notes, and expectations around FY27-FY28 growth.

PL Capital’s targets: buys on large caps and select mid caps

PL Capital listed multiple “Buy” calls with specific target prices. It has a ‘Buy’ rating on TCS with a target price of Rs 3,450 per share. It has a ‘Buy’ call on Infosys with a target price of Rs 1,570 per share. Tech Mahindra has a ‘Buy’ call with a target price of Rs 1,660.

PL Capital also flagged mid-cap ideas. Persistent Systems has a ‘Buy’ call with a target price of Rs 6,400. Mphasis has a target price of Rs 3,000. Coforge received a ‘Buy’ call with a target price of Rs 2,020 a share.

ICICI Direct and ICICI Securities: selective optimism, mixed ratings

ICICI Direct described TCS as “leading the pack” and noted the stock was trading around Rs 2,409.85. It has a ‘Buy’ rating and a target price of Rs 3,140 on TCS, indicating an upside of over 30% from the cited level. Alongside TCS, ICICI Direct named LTIMindtree and Persistent Systems as top picks, with a ‘Buy’ call on both and target prices of Rs 5,200 and Rs 5,750, respectively.

For Infosys and HCL Tech, ICICI Direct maintained a ‘Hold’ rating, with target prices of Rs 1,400 and Rs 1,500, respectively. It has a ‘Buy’ rating on Tech Mahindra with a target price of Rs 1,650.

Separately, ICICI Securities was referenced as having a mild positive report on Indian IT services and ratings that included ‘Buy’ on Infosys, TCS and TechM, ‘Reduce’ on HCL Technologies and ‘Sell’ on Wipro. ICICI Securities also said consensus is already modelling subdued revenue growth for FY27-28E.

Kotak’s warning: generative AI and lower fair values

Kotak Institutional Equities lowered EPS estimates for seven companies: Infosys, TCS, Wipro, HCLTech, Tech Mahindra, Persistent Systems and Coforge. It cut fair value estimates by roughly 15% to 28%. Kotak reduced TCS’ target price to Rs 3,090 from Rs 3,675 and lowered Infosys’ target to Rs 1,530 from Rs 1,900.

Among Tier-1 IT firms, Kotak cut Wipro’s target to Rs 190 from Rs 240, HCLTech’s to Rs 1,425 from Rs 1,680, and Tech Mahindra’s to Rs 1,615 from Rs 2,000. In mid-tier IT, Coforge’s target was revised down to Rs 1,620 from Rs 2,250, while Persistent Systems’ target was reduced to Rs 4,615 from Rs 5,900. Despite the cautious view, Kotak said it prefers Infosys, TCS and Tech Mahindra among large caps for valuations and cash generation, and remains positive on Coforge and Hexaware in mid caps.

Jefferies: target cuts up to 33% and more downgrades

Jefferies said it cut target prices by up to 33% on Indian IT stocks, linking the change to AI potentially shifting IT business mix towards consulting and implementation while shrinking managed services. It lowered EPS estimates by 1-4% and downgraded Infosys, HCL Technologies and Mphasis to ‘Hold’. It downgraded LTIMindtree, TCS and Hexaware Technologies to ‘Underperform’.

Jefferies’ fresh targets included Rs 1,290 for Infosys, Rs 1,390 for HCL Tech, Rs 2,450 for Mphasis, Rs 4,300 for LTIMindtree, Rs 2,350 for TCS and Rs 460 for Hexaware Technologies. It said Coforge, Sagility and IKS remained its preferred picks. HCL Technologies was also cited down 1.22% at Rs 1,419.50 at the time of that reference.

AI revenue scale: what broker notes highlight

One data point cited by ICICI Securities was the current scale of AI services revenue. It said AI services revenue for TCS has reached $1.5 billion, or 5% of FY26 estimated revenue. It compared this with Accenture at $1.7 billion (4% of revenue) in FY25 and HCL Tech at $1.4 billion (3% of revenue).

Systematix: preference for TCS and updated guidance context

Systematix highlighted TCS as its preferred pick within Tier-1 IT, citing a strong order book and a recovery in discretionary spending. It said INFY and HCL Tech raised the lower end of their revenue guidance. HCL Tech raised revenue guidance to 3-5% from 2-5%, which it read as signalling no further deterioration in demand going forward.

Systematix has a ‘buy’ rating on TCS with a target price of Rs 3,864. It suggested “hold” on Infosys (target price Rs 1,644), Wipro (Rs 225), HCL Technologies (Rs 1,592) and Sonata Software (Rs 423). In another referenced update on HCL Technologies, Jefferies was cited as maintaining a ‘Buy’ with a target price of Rs 1,850, while noting HCL remained confident of 3-5% growth in FY26 and that margins could be hit in FY26 but normalise in FY27.

Key broker targets and ratings at a glance

Why this matters for investors

Across broker notes, the common thread is selectivity rather than a uniform sector call. JPMorgan and Jefferies leaned more cautious on multiple names through downgrades and target cuts, while Kotak framed AI adoption as a risk to long-term growth and reduced valuations accordingly. Domestic brokerages such as PL Capital and ICICI Direct still see upside in specific stocks, particularly TCS, and also flagged picks like LTIMindtree and Persistent Systems.

The dispersion in targets also underlines uncertainty about how quickly AI changes delivery models, pricing and the managed services mix. Separately, company guidance changes, such as HCL Tech raising its revenue guidance range to 3-5% from 2-5%, are being used by some analysts to argue that demand is not deteriorating further. Investors tracking the sector are likely to watch whether earnings revisions, deal commentary and AI-led execution trends start narrowing the gap between optimistic and cautious brokerage views.

Conclusion

Brokerage coverage on Indian IT has turned more differentiated, with multiple target cuts and downgrades alongside selective buy ideas. The Nifty IT’s 24% decline in 2026 provides the backdrop to these revisions, even as some sessions see sharp one-day moves across IT names. The next set of guidance updates and any further earnings-forecast changes from brokerages are likely to remain key triggers for sector positioning.