IT Stocks Recover After Crash: TCS, Infosys To Wipro; Min Piyush Goyal Says It's Time To ‘Pick IT Stocks'

IT Stocks Crash: Shares of Tata Consultancy Services Limited (TCS), Coforge, Wipro, Tech Mahindra and Infosys staged a sharp recovery in the second half of Friday's trading session after plunging up to 10% earlier in the day, as concerns over artificial intelligence-led disruption triggered heavy selling across the IT pack.

The rebound in IT stocks came a day after Union Commerce Minister Piyush Goyal recommended market participants to "pick up" IT shares amid AI concerns, though the recovery appeared to be driven by trading dynamics rather than directly linked to his remarks.

Several IT stocks crashed significantly in the past two to three days, mirroring the sharp sell off in global IT stocks amid rising uncertainty and concerns over IT firms' restructuring due to AI implementation.

IT Stocks Crash: TCS, Infosys, Wipro, Other IT Stocks See Sharp Recovery

Nifty IT was down around 1.3% at 1:40 pm on Friday. However, the sectoral index was down nearly 10% to close to 31422.60 points earlier in the day. Infosys shares were down1.36%, Coforge shares were down 4.34%, Wipro shares were down 1.96%, TCS shares were down 1.96%, LTIM shares were down 1,65% at 1:44 pm.

The IT stocks have declined significantly over the past two to three days, as several IT companies' guidance, growth outlook and restructuring plans have raised concerns about revenue growth in the future.

"The rise of agentic AI signals that the conventional manpower-led, linear revenue growth model is under pressure. In our view, the era of broad-based rerating for generic service-driven IT companies is over. Investors should exercise caution and avoid fresh allocations to commoditised service players, using market bounces as potential exit opportunities instead of entry points," explained Prasenjit Paul, Equity Research Analyst at Paul Asset & Fund Manager at 129 Wealth Fund.

IT Stocks Recover After Crash: What To Expect?

The recent sharp movements in IT stocks is mostly driven by market sentiment rather than a deeper structural shift. Hence, investors should avoid panic and adopt for a staggered investment strategy, according to Swapnil Aggarwal, Director, VSRK Capital.

"Investors should avoid panic reactions and adopt a staggered investment strategy. Systematic Investment Plans (SIPs) or Systematic Transfer Plans (STPs) can help navigate volatility and average out costs. Instead of aggressive lump-sum investments, gradual allocation would be more prudent until clearer signs of strength and stability emerge in the market," explained Aggarwal.

Piyush Goyal Urges Investors To Stay Committed To IT Stocks

Union Commerce Minister Piyush Goyal recently urged investors to "have faith in the system" and also recommended investors to "pick up IT stocks", reported NDTV Profit.

"'Those in stock market need to be educated that our companies are at the cutting edge of technology. They need not have such a depressed outlook as companies are well prepared to embrace the future," NDTV Profit quoted Goyal as saying at the launch of NITI Ayog's report on Thursday.

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