IT's Market Grip Loosens in Nifty 50, Weight at 16-Yr Low

Weak earnings, Trump policies weigh on IT stocks

- KRISHNA KANT

(IT) services companies — Tata Consultancy Services, Infosys, Wipro, and HCLTech — were expected to outperform during a downturn on Dalal Street as the bulk of their revenues comes from exports. However, IT services companies have become the biggest laggards on the bourses, leading to a sharp decline in their weight in the benchmark Nifty 50.

The IT sector's weight in the Nifty 50 has slipped to a 16-year low of 11.66 per cent, down sharply from 13.53 per cent at the end of December 2024 and 12.48 per cent at the end of March 2024. This marks a sharp reversal in the industry's fortunes, which accounted for 17.67 per cent of the Nifty 50 at the end of March 2022 — the highest in 25 years.

For comparison, the sector has accounted for an average of 13.5 per cent of the Nifty 50 since 2001.

The Nifty IT Index — which tracks the market capitalization of the country's 10 biggest IT services companies — is down 14.1 per cent since the start of the calendar year, compared to a 0.06 per cent rise in the Nifty 50 during the same period.