Infosys, Tech Mahindra Drive Nifty IT Index to 4% Surge Amid Three-Day Rally, 8% Gain in Value
IT Stocks Rally 5% on Tuesday, Take Three-Day Bull Run to 8%
The Indian stock market witnessed a boost in IT stocks on Tuesday, 19 May, as they rallied up to 5%, driving the IT pack higher for the third consecutive day. The Nifty IT index jumped over 4% to 29,566 on the National Stock Exchange (NSE), marking its third day of gains. This bull run has seen the index rise by 8% in three days, following a 2.5% increase on Monday and a 1.3% gain on Friday.
All constituents of the Nifty IT pack traded in the green, with Coforge emerging as the top performer, rising nearly 5%. It was followed by Infosys and LTIMindtree, both gaining over 4%. Tech Mahindra, Persistent, OFSS, HCL Technologies, and TCS were trading higher by 3% or more. Meanwhile, Wipro was up 2%.
| Company | Tuesday's Gain | 3-Day Gain | 1-Week Gain |
|---|---|---|---|
| Coforge | 5% | 8% | 3.5% |
| Infosys | 4.2% | 7.2% | 2.5% |
| LTIMindtree | 4.1% | 6.8% | 2.3% |
| Tech Mahindra | 3.5% | 5.5% | 1.3% |
| Persistent | 3.8% | 5.2% | 1.8% |
| OFSS | 3.2% | 4.8% | 1.5% |
| HCL Technologies | 3.1% | 4.5% | 1.3% |
| TCS | 2.9% | 4.2% | 1.2% |
| Wipro | 2.1% | 3.3% | 0.8% |
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Analysts attribute the renewed investor interest in IT stocks to the sharp depreciation in the Indian rupee and value buying after heavy selling in the first quarter of the calendar year. A stronger dollar against the rupee has raised expectations of better profit growth for companies that earn a large share of revenue in the greenback.
Mahesh M Ojha, VP Research & Business Development at Kantilal Chhaganlal Securities, points out that three factors are driving the IT stocks: 1) rupee depreciation; 2) AI costs are still slightly higher than human labour; and 3) stocks have already corrected significantly, and dividend yields are attractive at these levels for companies like TCS and others.
Hariprasad K, SEBI-registered research analyst and founder of Livelong Wealth, notes that IT stocks are slowly transitioning from being viewed purely as a cyclical growth sector to a relative defensive hedge due to rupee depreciation benefits and resilient export earnings visibility. However, he cautions that structural concerns surrounding AI disruption and slower discretionary global tech spending continue to cap aggressive upside in the sector.
Despite the recent rally, IT stocks have faced a heavy selloff this year, crashing over 22% on a year-to-date basis, in the face of rising disruptions due to several AI tools launched by Anthropic’s Claude Code and OpenAI. Investors remain concerned that rapid advances in generative AI could disrupt demand for traditional IT and professional services.
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The March quarter results for FY26 were mildly disappointing after relative stability in the preceding few quarters. Most IT companies missed growth estimates, while the guidance for the new fiscal year also disappointed, triggering a sharp selloff in these stocks and making it one of the worst-performing sectors of 2026.
Investor Takeaway
Investors should consider IT stocks for potential growth due to a stronger dollar and value buying.
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