Synopsis
Indian IT companies are adapting to new AI models that promise to revolutionize software development. Despite recent stock sell-offs, companies are investing in AI training and partnerships, ensuring their continued relevance. Strong deals and favorable valuations suggest a resilient future for the sector.
ETMarkets.comIn terms of valuations too, comfort is setting in, as the current sales frenzy is pushing price-earnings multiples away from historical averages.ET Intelligence Group: Will Indian software companies meet the challenge presented by new business models? artificial intelligence (AI) that are transforming the way enterprise solutions are implemented and delivered to customers? Although the jury is still out, one thing is clear: domestic software exporters are far from being caught off guard.
Large and mid-sized IT companies have been exploring ways, through internal initiatives as well as acquisitions and collaborations, to adapt to technological developments that could strengthen their offerings. Rapid advancements in AI are expected to improve the efficiency of the supplier-customer ecosystem by shortening project timelines and enabling faster delivery of products and services to target markets. In this context, the current liquidation of IT stocks appears more like an impulsive reaction than a sign of a fundamental shift towards defensive sectors.
Last week, two major AI labs, OpenAI and Anthropic, released their latest models touting advanced capabilities for creating software programming codes with greater precision than previous models. This has impacted the technology and investment communities, forcing them to question the relevance of traditional strategies. software development companies that have thus far thrived by employing legions of programmers. The tremors were felt on Dalal Street as the BSE IT index lost 15 per cent in eight trading sessions till February 13, the biggest loss among the bourse’s sectoral indices.
Although uncertainties over the exact impact of AI capabilities will likely weigh on IT stocks in the near term, the mid- to long-term scenario looks less bleak given the agility IT exporters have shown in aligning their offerings with the latest technology trends. Apart from training staff on AI platforms and establishing tie-ups with global technology partners, Indian IT exporters have been quick to share productivity gains with their customers, which is expected to remain relevant.
Agencies The surge in new contracts won by IT companies in recent quarters ensures that they continue to offer valuable services to their customers. The total contract value (TCV) of orders placed by India’s top five IT exporters, including Tata Consulting Services (TCS), Infosys, HCL Technologies, WiproAnd Tech Mahindraremained above $20 billion in each of the five quarters through December 2025. It increased to $21.5 billion in the December 2025 quarter, up from $17.4 billion two years ago.
In terms of valuations too, comfort is setting in, as the current sales frenzy is pushing price-earnings multiples away from historical averages.
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Most trending stocks: SBI share price, Axis Bank share price, HDFC Bank share price, Infosys share price, Wipro stock price, NTPC stock price
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(What’s moving Sensex And Clever Track latest market news, stock market advice, Budget 2025, Equity market on the 2025 budget And expert adviceon AND Markets. Additionally, ETMarkets.com is now on Telegram. For the fastest news alerts on financial markets, investment strategies and stock market alerts, subscribe to our Telegram feeds .)
Subscribe to AND Bonus and read it Electronic document on economic times Online.and Sensex today.
Most trending stocks: SBI share price, Axis Bank share price, HDFC Bank share price, Infosys share price, Wipro stock price, NTPC stock price
…moreless