As AI panic grips IT stocks, where are market opportunities for big and small investors?
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India's information technology stocks are under pressure as concerns grow that artificial intelligence could disrupt the traditional outsourcing model. Individually, Wipro and TCS, two of the top three tech giants, fell over 30% from their peak, while Infosys is down about 25%. The sell-off is being driven by fears that highly autonomous tools such as Claude, Palantir's enterprise platforms and other AI agents could reduce the need for large teams of programmers and testers. The bear argument is that if enterprises can generate and maintain code internally using AI, the core value proposition of Indian IT services weakens. Brokerages have acknowledged that AI-led productivity gains are compressing billing-linked revenue models in the short term. Discretionary spending by global clients has also slowed. At the same time, deal pipelines are increasingly AI-focused. Cyclical slowdown or structural reset for investors? The key questio...