₹1.3 Lakh Crore Wiped Out! Why IT Stocks Including TCS and Infosys Plunged Today

Heavy Selling in IT Stocks Sends Market Cap Tumbling:
The Indian stock market witnessed a sharp decline in IT shares today, wiping out ₹1.3 lakh crore from the combined market capitalization of leading IT companies. Investor sentiment turned jittery over fears that artificial intelligence (AI) developments could impact traditional IT service revenue streams.

Market Impact:

• The Nifty IT index fell more than 4% during early trading, hitting a four-month low.
• Stocks of TCS, Infosys, Wipro, HCL Tech, and Mphasis fell between 4–5%.
• TCS shares dropped 4.5% to ₹2,776, reaching a 52-week low, bringing its market capitalization below ₹10 lakh crore.
• Overall, IT stocks’ market cap declined from ₹28.9 lakh crore to ₹27.6 lakh crore, a loss of ₹1.3 lakh crore.

Reason Behind the Sell-Off:
According to Dr. VK Vijaykumar, Chief Investment Strategist at Geojit Investments, the tech sector is currently shaken by disruptions from AI, particularly following the launch of a new tool by U.S.-based AI startup Anthropic. This tool, capable of performing a wide range of tasks, has raised concerns that traditional IT services may see revenue losses, potentially up to 40%, according to some analysts.

The combination of margin pressures, slowing demand, and emerging AI competition has prompted investors to shift funds from IT to other sectors, triggering widespread panic selling.

The Key Question:
Will India’s traditional IT service providers be able to adapt and compete with AI-driven solutions, or will this sector continue to face headwinds in the coming months?