Archive · 1 Oct 2026
Indian IT stocks rally as rupee weakens; Q2 outlook varies
Indian technology stocks went up while the broader stock market went down.
The Nifty IT index gained more than 2% on Thursday, 1 October.
The Indian rupee became weaker against the US dollar.
This can help IT companies because they earn much of their money in dollars.
When those dollars are converted into rupees, they may be worth more.
Morgan Stanley also gave positive ratings to Persistent Systems and Hexaware Technologies.
Analysts expect some smaller IT companies to grow faster than the largest firms.
However, analysts think the biggest IT companies may have a weaker quarter.
The Nifty IT index rose more than 2% on Thursday, 1 October, despite the Nifty 50 falling over 1%.
Mphasis, Coforge, Infosys, HCL Technologies, Tata Consultancy Services, Tech Mahindra, and Wipro gained between 1% and 5%.
The dollar index climbed to 101.71 while the rupee traded near 96 per dollar, improving Indian IT companies’ rupee-denominated margins.
Morgan Stanley’s reported overweight coverage of Persistent Systems and Hexaware Technologies also supported sentiment.
Brokerages expect mid-tier companies to outperform larger IT firms in Q2FY27, although estimates vary across companies.
- Who
- Indian IT companies, including Mphasis, Coforge, Infosys, HCL Technologies, Tata Consultancy Services, Tech Mahindra, Wipro, Persistent Systems, and Hexaware Technologies.
- What
- IT stocks rose sharply, lifting the Nifty IT index, as investors considered currency effects and upcoming Q2FY27 results.
- When
- Thursday, 1 October; the article discusses expectations for Q2FY27 results.
- Where
- Indian stock markets, with the companies earning a major share of revenue from the United States.
- Why
- The US dollar strengthened against the rupee, potentially improving IT companies’ margins, while brokerage views supported selected stocks.
Mid-tier growth optimism
Large-cap caution
Expected Q2FY27 performance
Mid-tier growth optimism
JM Financial expects mid-tier IT companies to deliver stronger growth, with execution supporting 2.7%-13% quarter-on-quarter constant-currency revenue growth; Emkay Global also expects select mid-caps to outperform.
Large-cap caution
Emkay Global expects large-cap IT companies to have a soft quarter, with tier-one constant-currency revenue growth ranging from -1.0% to 3.1%.
FY27 growth visibility
Mid-tier growth optimism
JM Financial expects mid-tier IT to deliver double-digit organic revenue growth in FY27, particularly during the first half, and says its valuation premium could persist or widen.
Large-cap caution
Large IT companies are still working toward achieving mid-single-digit revenue growth in FY27, according to JM Financial.
- Nifty IT move
- The index rose more than 2% in intraday trade.
- Nifty 50 move
- The benchmark index declined by more than 1% during the session.
- Currency levels
- The dollar index reached 101.71 and the rupee traded near 96 per dollar.
- Top gainers
- Mphasis rose 5%, Coforge 4%, Infosys 3%, HCL Technologies 2%, Tata Consultancy Services 2%, Tech Mahindra 2%, and Wipro 1.5%.
- Morgan Stanley view
- Morgan Stanley reportedly initiated coverage of Persistent Systems and Hexaware Technologies with an overweight rating.
- JM Financial forecast
- It expects mid-tier IT revenue growth of 2.7%-13% quarter-on-quarter in constant currency, compared with -0.5%-2.6% for large companies.
- Emkay Global forecast
- It expects tier-one companies to post -1.0%-3.1% constant-currency revenue growth, while tier-two companies may post 0.5%-8.0%, excluding Coforge.