IT Stocks Crash: Nifty IT Index Tanks Over 2% as Infosys, TCS, Wipro, HCL Tech Slide on AI Fears, Anthropic IPO and Valuation Worries, What Lies Ahead?

The Nifty IT index has been one of the weakest parts of the market this year, and the fall on Tuesday came on a day when the Nifty 50 also slipped below 22,700 and the Sensex lost about 350 points in the morning. When the Nifty IT index drops this fast, investors ask two questions: is the fall a pause inside a recovery or the start of another leg down, and which IT stocks look low-priced enough to be defensive. This article looks at the triggers, the stock-by-stock moves, valuations, results and technical levels.

I could not retrieve the exact Nifty IT index level or the names of the brokerages that see a recovery, so I flag both below and use the headline figure of about 2.3% only as reported. All other prices are from the data provider at the time stated. It is educational and not advice.

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Why the Nifty IT Index Fell Today

Nifty IT index: trigger	What was reported	Why it matters for IT stocks
Anthropic IPO filing	Anthropic filed for an IPO on the Nasdaq; it was valued at about $965 billion in its last funding round (BusinessToday)	A listing gives the AI theme a fresh boost, and IT investors fear that client budgets will move toward AI platforms
Meta equity raise	Meta Platforms announced that it is seeking about $95 billion through equity offerings (BusinessToday)	It raised doubts about the idea of a shift away from AI stocks, which Indian IT had been rallying on
Rally unwinding	Indian IT stocks had risen on hopes of a rotation away from AI names	When that hope weakened, the stocks that had risen most were sold first
Brokerage action	At least four brokerages cut their ratings on Infosys in a single day (BusinessToday); no target prices were given	A rating cut from several desks at once adds to selling pressure
Weak market	Nifty slipped below 22,700 and the Sensex fell about 350 points in the morning (Whalesbook)	IT is a heavy index weight, so its fall pulled the benchmarks lower

The Nifty IT index reacts to AI news because the sector's revenue is largely effort-based services such as maintenance, support and testing. Spending is moving toward AI infrastructure, AI-enabled software, cybersecurity, data readiness and modernisation, while traditional maintenance work faces more pricing pressure. The Nifty IT index therefore trades as a bet on how quickly Indian firms can win the new kind of work, and any AI disruption headline moves the Nifty IT index within minutes.

AI disruption is the common thread in every trigger above. The Anthropic figures reported by BusinessToday include a net loss of $80.7 billion in the first half of 2026 on revenue of $16.3 billion, and a remark that growth will not match the 1,000% seen in 2025. Those numbers show the scale of AI spending that Indian IT firms are competing with for client budgets. They are not a forecast for any Indian company.

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Nifty IT Index Stocks: Who Fell and by How Much

Nifty IT index stock	Price at 11:35 AM	Previous close	Day change	52-week high	Below high (my calculation)
TCS	Rs 2,474.80	Rs 2,535	-2.37%	Rs 3,350	26.1%
Infosys	Rs 1,147.90	Rs 1,166	-1.55%	Rs 1,728	33.6%
Coforge	Rs 1,955.90	Rs 1,993	-1.86%	Rs 2,021.20	3.2%
Persistent Systems	Rs 5,775.50	Rs 5,850	-1.27%	Rs 6,599	12.5%
Mphasis	Rs 2,525.20	Rs 2,557.60	-1.27%	Rs 2,975	15.1%
Wipro	Rs 186.66	Rs 189.20	-1.34%	Rs 273.10	31.7%
HCLTech	Rs 1,401.50	Rs 1,417	-1.09%	Rs 1,780.10	21.3%
Tech Mahindra	Rs 1,778.80	Rs 1,795	-0.90%	Rs 1,854	4.1%

BusinessToday reported earlier moves of 2.31% for Infosys (to Rs 1,139.05) and 2.09% for TCS (to Rs 2,481.90), and it described Infosys as the worst performer on the Nifty IT index. By 11:35 AM Infosys had recovered a little and TCS had fallen further, so the order of the losers changed during the morning. The BusinessToday article also said that Coforge was down 1.66% and Persistent Systems down 1.54%, and that Wipro, Mphasis, HCLTech and Tech Mahindra were each down more than 1% at that time.

The table shows two groups. Infosys, TCS and Wipro are still 26% to 34% below their 52-week highs, so the Nifty IT index is far from a broad record. Coforge and Tech Mahindra are within about 3% to 4% of their highs, which is why mid-cap IT names have more to lose if the mood stays weak.

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Valuation of the Nifty IT Index Heavyweights

Nifty IT index stock	Price to earnings	Return on equity	Dividend yield	Market cap
TCS	17.69	43.37%	4.34%	Rs 9,17,547 crore
Infosys	15.36	31.03%	4.12%	Rs 4,72,791 crore
HCLTech	20.99	24.08%	3.81%	Rs 3,84,798 crore
Wipro	14.16	16.68%	6.16%	Rs 1,87,213 crore

The data provider shows an industry price to earnings level of 17.55 for the group. Infosys and Wipro trade below it, TCS is almost at it and HCLTech is above it. Valuation, which the headline calls elevated, is therefore not uniform across the Nifty IT index, and the Infosys share price multiple of 15.36 is below the industry level, and the high dividend yields of 3.8% to 6.2% give long-term holders some income while they wait. Elevated valuation is more visible in mid-cap IT names of the Nifty IT index, and I did not retrieve their multiples.

Q2 FY27 Results Behind the Nifty IT Index

Q2 FY27 vs Q2 FY26 (my calculation)	Revenue (Rs crore)	Revenue growth	Net profit (Rs crore)	Net profit growth	Operating margin
TCS	74,525	11.8%	13,934	14.9%	27.53%
Infosys	50,092	10.2%	7,838	6.3%	25.46%
HCLTech	35,854	10.8%	5,132	21.2%	21.54%
Wipro	25,508.2	7.9%	3,199.7	-1.9%	22.73%

The Q2 results do not show a collapse in demand. Three of the four large caps grew revenue by around 10% to 12% and profit growth was positive for TCS, Infosys and HCLTech, while Wipro's profit slipped about 1.9% (my calculation from data provider series), and the Infosys share price now trades well below its 52-week high. The fear in the Nifty IT index is about the future mix of work and pricing, not about the quarter already reported. For the Infosys share price, the Q2 results showed profit up about 6.3% year on year (my calculation), and the Nifty IT index has to be judged against that base.

Technical Levels for the Nifty IT Index Stocks

Nifty IT index stock	Daily RSI (14)	20-day EMA	SuperTrend (10, 3)	SuperTrend lower band
TCS	78.77	Rs 2,325.02	Buy	Rs 2,288.32
Infosys	71.85	Rs 1,092.57	Buy	Rs 1,053.35
Wipro	77.40	Rs 175.74	Buy	Rs 173.88
HCLTech	83.98	Rs 1,333.13	Buy	Rs 1,300.40

These daily readings were taken at 11:37 AM and include the intraday fall. An RSI above 70 means the stocks were still overbought even after the drop, so the Nifty IT index may need more time to cool. The first test is the 20-day EMA: Infosys at Rs 1,092.57 is about 4.8% below the current price, TCS at Rs 2,325.02 is about 6.0% below and HCLTech at Rs 1,333.13 is about 4.9% below (my calculation). A close below those averages would weaken the trend for the Nifty IT index, while the SuperTrend lower bands are the next support the data provider shows. These are trend readings and not targets.

What Lies Ahead for the Nifty IT Index

HDFC Securities' Nandish Shah said the AI theme received a fresh boost from the Anthropic filing, and the same report noted that Wall Street demand does not support the view that high borrowing costs will end the investment phase. The headline of the screenshot says brokerages see potential for recovery after the AI disruption scare and a re-rating that depends on earnings growth. I could not retrieve the names of those brokerages or any target prices, so I do not quote them.

1. AI headlines. More listings, funding rounds or model launches can keep pressure on the Nifty IT index in the short term.
2. US and European demand. Client budgets decide Indian IT revenue, and the Fed meeting on 27 and 28 Oct is a macro event to watch.
3. Rupee. A weak rupee, around 95.2 to the US dollar this morning, helps reported margins but does not fix demand worries.
4. Deal wins and AI revenue. Firms that show growing AI-linked deal pipelines can earn a better multiple.
5. Overbought readings. RSI above 70 raises the risk of further profit-taking before any recovery.

Conclusion: The Nifty IT Index Is Resetting, Not Breaking

The Nifty IT index fell over 2% because AI news revived a familiar fear, and because a rally had left several large caps overbought. Results are still growing, valuations are fair for Infosys, TCS and Wipro against the industry level, and dividend yields are high, but the pace of AI-led change in pricing is the real unknown. The Nifty IT index may stay volatile until the Fed meeting and the next AI headlines pass, and the Nifty IT index outlook depends on earnings growth. Verify the filings and decide according to your own risk profile.

Frequently Asked Questions

Why did IT stocks crash on 27 Oct 2026?

Ans. The Nifty IT index fell after Anthropic filed for a Nasdaq IPO and Meta Platforms said it was seeking about $95 billion through equity offerings. These events revived fears that AI will take budgets from traditional IT services. All ten stocks in the index were lower, with Infosys and TCS among the biggest losers. The headline move was about 2.3%.

How much did Infosys, TCS, Wipro and HCL Tech fall?

Ans. At 11:35 AM the data provider showed TCS down 2.37% at Rs 2,474.80, Infosys down 1.55% at Rs 1,147.90, Wipro down 1.34% at Rs 186.66 and HCLTech down 1.09% at Rs 1,401.50. BusinessToday reported earlier figures of 2.31% for Infosys and 2.09% for TCS. Prices change during the day, so check the live quote.

Is the fall in the Nifty IT index a buying opportunity?

Ans. That depends on your time horizon and risk profile, and this article is not a recommendation. Infosys, TCS and Wipro trade at 15.4, 17.7 and 14.2 times earnings against an industry level of 17.55, and yields are 4% to 6%. Against that, daily RSI readings are still above 70 and the AI pressure on pricing is unresolved.

Are IT company results weak?

Ans. Not on the Q2 results for FY27 in the data provider series. My calculation shows revenue growth of 11.8% for TCS, 10.2% for Infosys, 10.8% for HCLTech and 7.9% for Wipro, with profit growth positive for three of the four. Wipro's profit fell about 1.9%. The concern is the future mix and pricing of work.

What is the link between the Anthropic IPO and Indian IT stocks?

Ans. The filing boosted the AI theme, and investors fear that more spending will go to AI platforms and AI-enabled software instead of traditional IT services. BusinessToday also reported that semiconductor stocks rose in the US on the news. Indian IT firms say they can win AI-linked work, but the market is waiting for proof in revenue.

Which technical levels matter for the Nifty IT index stocks?

Ans. Daily readings show 20-day EMAs of Rs 1,092.57 for Infosys, Rs 2,325.02 for TCS, Rs 175.74 for Wipro and Rs 1,333.13 for HCLTech, with SuperTrend lower bands of Rs 1,053.35, Rs 2,288.32, Rs 173.88 and Rs 1,300.40. All four RSI readings are above 70. These are trend readings and not targets.

What should investors watch next in IT stocks?

Ans. For the Nifty IT index, watch the Fed meeting on 27 and 28 Oct, further AI listings or funding news, US and European client demand, the rupee, and deal wins linked to AI. The next quarterly results will show whether pricing pressure is spreading. Check company filings before taking any decision.

Is this article investment advice?

Ans. No. It is educational and not a recommendation to buy or sell. Please check the figures against company filings and your own risk profile before you act on anything you read here.