Coforge, Wipro and other IT stocks fall up to 2% amid Trump tariff jitters

Shares of tech majors, which earn a significant portion of their revenue in U.S. dollars, including Coforge, HCL Technologies, Tata Consultancy Services (TCS), Infosys and Wipro slipped between 1.3% and 1.8%. The Nifty IT index dropped 1.5%, emerging as the biggest drag on benchmark indices for a second day in a row.

The downturn in IT stocks began on Thursday following U.S. President Donald Trump’s declaration late Wednesday of a 10% baseline tariff on all imports, with higher rates for countries with significant trade surpluses with the U.S. India was subjected to a 27% retaliatory levy, a rate lower than those imposed on China (34%), Vietnam (46%), and Bangladesh (37%).

India’s IT sector has been reeling under pressure recently, battered by a toxic mix of Trump tariffs fueling U.S. recession risks, weak earnings expectations, and a brutal wave of broker downgrades.

All 10 stocks in the Nifty IT index are now in bear territory—down over 20% from their peaks—with heavyweights like TCS (-26%), Infosys (-25%), and HCL Tech (-27%) leading the plunge. Oracle Financial Services Software (OFSS) has suffered the deepest wounds, sinking 43%. The Nifty IT index itself has crashed about 23% from its highs, making IT the biggest casualty in India’s stock market rout this year.

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Meanwhile, brokerages have been slashing target prices and downgrading the sector ahead of the Q4 earnings season, warning that weak U.S. demand, macroeconomic uncertainties, and the chilling effect of Trump’s tariffs could drag IT firms deeper into turmoil.“We continue with our ‘downgrade’ stance on IT,” Axis Securities noted. “Slowdown in overall IT spending in the US market as well as a probable delay in discretionary spending, which may pose a downgrade risk in upcoming quarters. These downgrade risks could pose a challenge to the valuation of the IT sector in the near term. With overnight development of Trump tariffs, the chances of downgrades have further increased. Hence, we recommend reducing positions in the IT sector.”Jefferies echoed similar concerns, noting that while IT has no direct exposure to tariffs, the impact on U.S. GDP could hurt demand for outsourcing. “Demand from manufacturing, logistics, and retail verticals will get impacted due to higher tariffs,” it said. “Tech Mahindra and HCL Tech, among large caps, and IKS, Sagility among midcaps, have a favorable vertical exposure.”

The IT sector is heading into Q4 earnings season under a cloud of pessimism. With TCS kicking off results on April 10, analysts expect a weak quarter marked by revenue declines, subdued guidance, and cautious commentary from management teams.

“We expect sequential revenue declines for all large IT firms in Q4FY25,” Kotak Institutional Equities said. “Seasonal weakness, lower billing days, and macro uncertainty will weigh on the sector.”

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