IT stocks rallied after Tech Mahindra's stronger-than-expected June-quarter earnings boosted sentiment.
Infosys, Tech Mahindra, HCLTech and TCS gained, while Wipro declined after weak results.
Brokerages turned bullish on Tech Mahindra, citing margin expansion and strong deal wins.
Shares of information technology (IT) companies rallied on Friday after Tech Mahindra reported better-than-expected June-quarter earnings, prompting brokerages to turn more bullish on the stock and lifting sentiment across the sector.
Infosys led the gains among large-cap IT stocks, rising 3.3% to ₹1,117, while Tech Mahindra advanced 3.4% to ₹1,563. HCLTech climbed 3% to ₹1,221, and Tata Consultancy Services (TCS) gained 2.5% to touch an intraday high of ₹2,256.
4 July 2026
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Persistent Systems also gained over 1%, while the broader Nifty IT index rose 658 points, or 2.3%, to 29,381.
However, the gains were not uniform across the sector. Wipro fell more than 3% after reporting weak first-quarter results, while Oracle and Coforge declined over 1% each.
The rally comes after a difficult year for IT stocks. The Nifty IT index has fallen nearly 23% so far in 2026, compared with a 7% decline in the benchmark Nifty 50.
Brokerages Turn Positive On Tech Mahindra
Brokerages said Tech Mahindra's June-quarter performance exceeded expectations across key operating metrics.
Nomura said Tech Mahindra delivered an all-round earnings beat in Q1 FY27, with constant-currency revenue growing nearly 3% quarter-on-quarter to $1.66 billion, ahead of its estimate of 1% growth. The brokerage said the growth was broad-based across major verticals.
It also noted that the company's EBIT margin of 14.4% exceeded its estimate of 14.1%, helped by Project Fortius and currency depreciation.
Nomura retained its 'Neutral' rating but raised its target price to ₹1,600 from ₹1,400, saying Tech Mahindra is on track to outperform other large-cap IT peers on growth during FY27 and FY28.
Nuvama also said Tech Mahindra delivered a strong start to FY27, highlighting broad-based revenue growth, continued margin expansion and healthy deal wins.
The brokerage retained its 'Buy' rating while increasing its target price to ₹1,800 from ₹1,750, and upgraded its FY27 and FY28 earnings estimates.
HCLTech Wins Long-Term AI Deal, Wipro Disappoints
Separately, HCLTech announced a new seven-year agreement with The Guardian Life Insurance Company of America to expand their existing partnership and accelerate AI-led modernisation across the insurer's technology and operations.
Under the agreement, HCLTech will help Guardian scale AI-powered transformation aimed at improving operational efficiency, reducing friction and developing AI-led solutions for the insurance sector.
Meanwhile, Wipro remained under pressure after reporting subdued quarterly earnings.
Nomura retained its 'Buy' rating on Wipro but lowered its target price to ₹190 from ₹200. The brokerage said Wipro's constant-currency revenue declined 1.2% quarter-on-quarter, while its EBIT margin of 16% fell short of its estimate of 16.5%.
The mixed earnings season comes as Indian IT companies continue to face challenges from weaker discretionary technology spending, pricing pressure, wage inflation and growing investor concerns over the impact of artificial intelligence on traditional outsourcing businesses.
