Nifty IT surges up to 2% as Infosys, Coforge, TCS rally; Bernstein sees sector rebound in FY27

IT stocks saw a surge on Friday, May 23, with the Nifty IT index climbing nearly 2 per cent. This uptick came after global brokerage Bernstein expressed a positive outlook for the sector’s medium-term prospects. They anticipate a significant rebound in revenue growth by FY2027, thanks to a stable demand environment and increased deal activity.

Bernstein highlighted that major players like Infosys and TCS are maintaining steady growth, while mid-sized companies such as Coforge and Persistent Systems are their top picks for outperforming in the upcoming quarters.

Coforge, Persistent shine as SMID favourites

Infosys has been a favorite among large-cap stocks due to its ability to maintain strong margins. However, Bernstein has picked Coforge and Persistent Systems as its top choices in the SMID sector, highlighting their impressive growth rates and solid execution skills.

The rise of artificial intelligence is also boosting client spending, particularly in the financial services sector, which remains the strongest area for major IT companies. In Q4FY25, large IT firms secured deals totaling $21.9 billion, with TCS, Infosys, and HCL Technologies leading the charge.

Bernstein raises targets across top IT stocks

Here are Bernstein’s revised target prices:

• Infosys: Upgraded to Rs 1,760 from Rs 1,680

• Tata Consultancy Services (TCS): Hiked to Rs 3,910 from Rs 3,740

• Tech Mahindra: Raised to Rs 1,680 from Rs 1,480

• Coforge: Jumped to Rs 9,530 from Rs 8,630

KPIT stays positive, L&T Tech downgraded

Bernstein has kept an ‘outperform’ rating on KPIT Technologies but has slightly lowered its target price to Rs 1,390 from Rs 1,400. On the other hand, L&T Technology Services is lagging behind with an ‘underperform’ rating and a reduced target price of Rs 3,990, down from Rs 4,150.

Nifty IT top sectoral gainer

By 10:25 am, the Nifty IT index was shining bright, climbing 1.8 percent to reach 37,711.40. By around 12:30 pm, it maintained a solid position at 37,548.05, still up by 1.34 percent. Every stock in the index was on the rise, with Oracle Financial Services Software, Coforge, and Persistent Systems leading the way, each enjoying gains of up to 3 percent.