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Shares of India’s leading information technology companies surged in early trade on Friday, with Tata Consultancy Services (TCS), Infosys, HCLTech, Wipro and Tech Mahindra leading gains after TCS reported stronger-than-expected first-quarter results for FY27.
The Nifty IT index jumped more than 3%, making it the best-performing sector of the day. TCS rose nearly 3.7%, while Infosys, Tech Mahindra, HCLTech and Wipro also posted strong gains as investors turned optimistic about the sector’s earnings outlook.
TCS Earnings Drive the Rally
The primary trigger for the rally was TCS’ better-than-expected June quarter performance. The company reported a 4.6% year-on-year increase in consolidated net profit to Rs 13,349 crore, while revenue from operations grew nearly 14% to Rs 72,275 crore.
Growth was supported by healthy demand from banking, financial services and insurance (BFSI) clients, favourable currency movements and strong execution of large technology projects.
Strong Deal Wins Boost Confidence
TCS also reported total contract wins worth $9.5 billion during the quarter, including an $800 million AI-led transformation deal with global industrial company SKF.
The strong deal pipeline reinforced confidence that enterprises continue to invest in digital transformation despite global economic uncertainty.
Positive Management Outlook
Investor sentiment was further strengthened by management’s optimistic commentary. TCS Managing Director and CEO K Krithivasan said client spending is expected to improve in the second quarter as businesses resume delayed technology investments.
The company highlighted growing opportunities in artificial intelligence (AI), cloud modernisation, cybersecurity and enterprise platform transformation, which are expected to remain long-term growth drivers.
AI Business Continues to Expand
TCS reported annualised AI revenue of $2.6 billion, reflecting continued growth in demand for AI-powered solutions. The company also announced strategic partnerships with Anthropic and Mistral to strengthen its AI capabilities and expand enterprise AI services.
The company’s focus on increasing AI talent and deploying more engineers for client transformation projects has further boosted investor confidence.
Why the Entire IT Sector Is Rising
As India’s largest IT services company, TCS is widely regarded as the sector’s bellwether. Its quarterly performance often sets expectations for other major IT firms.
A strong start to the earnings season has raised hopes that peers such as Infosys, HCLTech, Wipro and Tech Mahindra could also report resilient financial results despite ongoing global macroeconomic challenges.
Market participants believe stable demand from the BFSI sector, expanding AI adoption and a healthy deal pipeline could support a gradual recovery in earnings across the Indian IT industry over the coming quarters.