From TCS to Infosys, the Indian companies taking a hit due to Trump tariffs

Indian tech companies are taking a hit over US President Donald Trump’s tariffs.

Shares of TCS, Infosys, Wipro and Persistent all tumbled on Thursday and Friday.

Many fear tech companies in India could face major headwinds as a result of Trump’s new policies.

But how are tech companies being affected? And what do experts say?

What happened?

Shares of IT firms have declined precipitously over the past two days.

As per Economic Times, Thursday witnessed the Nifty IT index decline by 4.21 per cent by the end of the day.

Persistent Systems experienced the most fall at 9.75 per cent.

Coforge declined by 7.81 per cent, Mphasis by 3.97 per cent.

Shares of Wipro, LTIMindtree, Infosys, Coforge and HCL Technologies all declined between 3 and 3.5 per cent.

Friday brought no relief either.

Coforge shares dropped another 7.67 per cent, while HCL shares declined 3.27 per cent.

Infosys Computers shares dropped three per cent, while LT Technology declined by over 4 per cent.

 LTIMindtree Computers was down by 4.74 per cent at the end of the day.

The Nifty IT Index closed a shade under 1.5 per cent lower on Friday to end around 34,233.

The Nifty IT Index is down 7 per cent in the past month, as per Financial Express.

As per Moneycontrol, the Nifty IT Index is down by over 20 per cent since January 1.

Editor’s Picks

1

Pharma, jewellery and garments… India’s big winners and losers after Trump’s ‘Liberation Day’ tariffs 2

26% on India, 34% on China: How did Trump govt calculate tariffs for 'Liberation Day'?

What do experts say?

They say the IT sector may be impacted indirectly – a result of slower GDP growth in the US.

This is because Indian IT companies derive nearly 70 per cent of their export revenue from the US, as per Indian Express.

Financial Express quoted international brokerage house Bernstein as taking an underweight position on IT.

Bernstein said the tariffs can have significant “inflationary impact on the US, leading to depressed demand and increased chances of a recession there.”

 “We expect a sequential revenue decline for all large Indian IT service companies for the March 2025 quarter due to seasonal weakness, lower billing days, and marginal deterioration in demand,” Sumit Pokharna from Kotak Securities told Moneycontrol.

“The fallout of tariff threats by the US is a slowdown and uncertainty in spending,” Pokharna added.

“Higher tariffs may result in higher inflation (versus the two per cent target of the US Fed) and may impact the Fed’s rate cut decision which is not conducive for the IT sector, in general,” Pokharna added.

 Elara Securities told Financial Express, “There has been no meaningful recovery in the macro environment, especially in the US market, which should weigh on FY26 performance.”

“IT players are running out of levers for margin expansion given already low attrition and high utilization. Pricing strain does exist in new deals, which may cap meaningful margin expansion in FY26 our view. We prefer TCS, MPHL and LTIM on valuation comfort.”

With inputs from agencies