AI reset erases nearly half of IT majors’ value

India’s top 10 software exporters, based on annual revenue, are on course to lose $200 billion of aggregate market value from their peak market cap levels amid the rise of disruptive artifi cial intelligence (AI) technology that has a potential to rewrite the rules of client deployment.

The sample hit a record aggregate market cap of $413 billion on December 13, 2024. Its market cap as on May 14, 2026, has fallen by $186 billion, or 45%, from that peak to $227 billion.

In 2026 so far, the sample pack has lost $98.7 billion, or 30%, in market cap. When individual peak market caps of the sample companies are considered, the loss amounts to $193 billion, reflecting the worst bout of absolute market cap erosion, implying a 45% fall.

TCS and Wipro suffered the sharpest fall of over 50%, amounting to $87 billion and $21 billion in absolute terms from their respective peaks. On the other hand, Tech Mahindra and Persistent Systems shed 25% and 30% during the period, the lowest among the sample companies.

Market cap erosion is not new to the Indian IT sector. It has shown high volatility in times of geopolitical uncertainties and technological shifts. While the current rout is the largest in terms of absolute erosion, the biggest percentage change was during the dot-com bubble burst in 2000 when top IT stocks fell by as much as 75% in a span of six-seven months.

Again, during the subprime crisis of 2008, the stocks lost 50-70% in a span of nine months. During the 2013 taper tantrum, IT stocks shed 15-30% in a span of two months.