The Information and technology sector stocks also faced severe selling pressure today. The IT stocks, apart from pharma were among the biggest drag on the indices. The Nifty IT Index plunged over 2%. Stocks like Coforge, Persistent and MphasiS all ended down over 2% each. Even the Index heavyweights like Infosys, Wipro and TCS closed the Friday session with over 2% losses each.
Accenture earnings a source of worry?
Accenture earnings came out overnight and the demand scenario remains as is. The company has not seen any meaningful change in demand – either positive or negative – across its 9,000 clients. Both Consulting and Outsourcing are expected to grow in low-to-mid-single digits.
It expects FY26 adjusted operating margin of 15.7–15.9%. In Q1, the management expects 1–5% YoY growth in revenues including the 1.5% headwind from the US Federal business. In Q4, Accenture’s headcount fell 11,000 QoQ with the data & AI workforce now at 77,000.
Here is a look at how brokerages are analysing the results and its implication for Indian tech stocks-
Nuvama on Indian tech sector: Volatile near-term
Nuvama pointed out that though Accenture delivered revenue growth at the top end of guidance range with growth driven
by Managed Services, they remain ‘Neutral’ on the Indian IT sector. They expect the sector to remain “volatile in the near-term, impacted by weak and uncertain macro. “Over the medium to long-term, we remain positive, anticipating a recovery in macro environment would accelerate enterprise tech spending,” they added.
JM Financial on Indian tech sector: Outlook soft for Indian IT
Accenture has not seen any meaningful change in demand– either positive or negative – across its 9,000 clients. JM Financial believes that this “should lend some stability to current estimates for India IT Services. Softer outlook in managed services might indicate growth deceleration for Indian peers, though could be attributed to lower bookings.”
They believe that Accenture’s commentary around clients’ still nascent data/tech readiness for AI, inflecting enterprisewide AI adoption as well as its own net headcount addition across markets, “suggests AI is likely expansionary, a positive for the industry. Post H-1B visa hike order, sector has corrected 5%, pricing any potential impact on earnings. Stabilising demand andreasonable valuations therefore make the risk-reward favourable, in our view,” they added.