IT Stocks Crash Up to 10%: HCL Technologies, Infosys, Tata Consultancy Services Lead Selloff

HCL Tech Worst Hit, Marks Steepest Fall in Over a Decade

HCL Technologies’ stock plummeted by 9.7% to emerge as the biggest loser among stocks in the index while approaching the lowest-ever single day fall in eleven years. The steep fall in stock prices came on account of poor Q4FY26 earnings and a cautious guidance.

The company’s revenue during Q4 FY26 amounted to $3,682 million, dropping 3.3% quarter over quarter in constant currency, much worse than consensus estimates of -1.6%. Its margins were lower than expectations at 16.5%, with a decline of 200 basis points quarter-over-quarter against estimates of 17.5%.

The company’s total contract value amounted to $1.9 billion, showing a substantial year-over-year decline of 35%. Furthermore, its guidance for FY27 services revenue growth of 1.5%-4.5% came out below expectations.

Weak Demand and Cautious Outlook Trigger Sector-Wide Concerns

According to the CEO of C Vijayakumar, poor performance in Q3 was primarily due to lackluster discretionary spending. This is more of a general issue within the industry rather than one particular to individual companies.

The negative sentiment regarding demand and visibility regarding growth prospects has caused worry regarding the earnings picture of the whole IT industry. According to a Goldman Sachs report, slower ramp-up of projects and macroeconomic issues have the potential to cause further delay in demand recovery.

Broad-Based Decline Across IT Stocks

The selloff extended beyond the HCL Technologies stock. The other large IT stocks witnessed an intense drop in prices. For example, Infosys declined by 2.54% to close at ₹1,279.90 before releasing its results for the quarter. Additionally, Tata Consultancy Services lost 1.49%, ending at ₹2,571.70.

Furthermore, Tech Mahindra tumbled 2.57%, closing the day at ₹1,462.30, ahead of its results release on April 22. Moreover, Persistent Systems lost ground, sliding by 4.32% to ₹5,099.80 owing to underperformance in its quarterly earnings.

The medium-sized IT stocks were not spared either, with Coforge slipping 2.61% to end at ₹1,259.00. On the other hand, LTIMindtree experienced a 1.79% slide, settling at ₹4,672

Persistent Systems and Sector Data Signal Weak Momentum

For the quarter under review, Persistent Systems experienced 3.4% year-over-year growth in constant currency revenues which was slightly lower than expected at 3.5%–4%. The EBIT margin stood at 16.3%, beating the expected margin by 16.9%. Total deals booked fell by 10% to stand at $600.8 million from the previous figure of $674.5 million.

Earnings Season Pressure and Global Headwinds

The information technology industry is under strain from many factors globally during the last year. They include uncertainty over tariffs by the US government, increased H1-B visa fees, geopolitical situations, and worries about artificial intelligence hurting demand for information technology services.

In early November, Tata Consultancy Services announced an unprecedented decrease in its yearly revenue in dollars, while Wipro missed its earnings target owing to various factors, both geopolitical and specific to customers.

Focus Shifts to Infosys Results

The focus of investors is now squarely on Infosys, which will be reporting its Q4 earnings on April 23rd. Its net profit is expected to stand at ₹7,508.6 crore, with a YoY growth of 4% from ₹7,218 crore. On a QoQ basis, however, net profit is forecast to fall by 1.5% from ₹7,625 crore in Q3 FY26.

As for revenue, it is expected to climb by 13.7% YoY to ₹46,567 crore from ₹40,925 crore previously, and climb by 2% QoQ from ₹45,479 crore.

Outlook: Recovery Remains Uncertain

This abrupt correction in the IT stocks demonstrates that there are increasing worries among investors regarding weakening demand, poor deal flow, and lack of visibility for growth in the near future.

The markets will remain watchful for the earnings releases and management statements in coming days, especially from Infosys and Tech Mahindra, as investors attempt to figure out whether this slowdown is just temporary or part of an extended downturn cycle.