US visa curbs, weak demand lead to decline in IT stocks

BENGALURU: Some Indian IT stocks took a success on BSE after US President Donald Trump’s newest proclamation on the H-1B visa, deepening considerations in an already fragile demand atmosphere. TCS and Tech Mahindra led the losses among the many high 5 IT companies, every falling greater than 3%. HCLTech noticed the least decline at 1.8%. Among the mid-caps, LTIMindtree dropped 4.5%, Mphasis 4.6%, Persistent 4.1% and Coforge 4.3%.Equirus Securities, in a word, stated most Indian IT corporations nonetheless have a substantial dependence on H-1B visas as a proportion of their US worker base. However, this proportion has been decreasing during the last 6-8 years, now forming round 25-35% for many giant caps and 30-60% for others. “However, it can impact sales growth in the second half of FY26 to some extent/marginally given this pivoting requires proper planning/approvals, which in turn can impact the US-centric project start and ramp-up in many cases and likely delay client decision-making in awarding deals.“A report by Kotak Institutional Equities confirmed that 4 of the 5 giant IT corporations posted sequential income declines in the June quarter, with EBIT margins contracting year-on-year for the highest three gamers regardless of aggressive value management measures. “The levers to protect profitability – such as utilization and subcontractor optimisation-are largely exhausted after three years of subdued demand,” the brokerage famous. Vertical-wise, BFSI remained the lone vivid spot.Manufacturing, retail and healthcare verticals underperformed due to tariff-related uncertainty, discretionary spending cuts and stress on payers.