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Falling rupee, looming Fed cuts lift hopes for IT sector
Mint New Delhi
|September 09, 2025
Beaten-down shares of India's top five IT services firms are attracting fresh interest from analysts betting that a weaker rupee, artificial intelligence (AI) deals, and possible US rate cuts could spark a revival.
Nuvama Institutional Equities, Axis Capital, Antique Stock Broking Ltd, JM Financial and HDFC Securities are among broking houses which have found optimism in IT.
Nuvama on 1 September upgraded its recommendation on India's information technology services sector from 'underweight' to 'overweight', recommending that investors include more IT stocks in their portfolio. "Over the last three years, IT has become more of a trading/relative valuation call rather than a structural one," Nuvama analysts said in a note, adding that "a weaker INR would mitigate the demand slowdown".
The rupee has depreciated nearly 3% against the US dollar this year, which could potentially translate to higher revenue for Indian IT service providers as they fetch more than half their earnings from the US.
The rupee fell 3.1% against the US dollar to end at 88.27 on Friday. Money markets remained closed on Monday.
This story is from the September 09, 2025 edition of Mint New Delhi.
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