Nifty IT Index: Tuesday morning brought new energy to the Indian stock market. As soon as the market opened, the eyes of investors were completely focused on the IT sector. There was such buying in the stocks of big companies like TCS, Infosys, Wipro and HCL Tech that within a short time these stocks jumped up to 5 percent. This all-out buying had a direct impact on the Nifty IT index, which was seen trading with a strong jump of 3 percent. For investors in the stock market, today was completely in the name of the IT sector.

This rise did not come suddenly. There are many solid reasons and excellent statistics behind it. The ups and downs that have been going on in the market for the past few weeks have been brought to an end by the second quarter results of IT companies. What investors have been eagerly waiting for is evident in the balance sheets of these companies.

HCL Tech’s profit surprised the market

In today’s spectacular boom, HCL Tech has emerged as the biggest hero. HCL Tech shares have given the highest returns to investors among the top 30 Sensex companies. The company has announced its results for the July-September quarter of fiscal 2027 (Q2FY27), beating all market estimates. The company’s consolidated net profit rose by an impressive 21.18 percent year-on-year to Rs. 5,132 crore has reached.

Finally, what is the secret behind these incredible profits? In fact, the company is reaping huge benefits from its advanced AI operations. The growing demand for AI has improved the company’s margins tremendously. Along with this, the benefit of lower tax payments has also gone directly to the company’s account, due to which profits have increased further. If we talk about revenue, in rupee terms, HCL Tech’s revenue grew by 3 percent quarter-on-quarter (QoQ) and 11.51 percent year-on-year to Rs. 35,620 crores. In dollar terms, the company’s revenue was $3.72 billion, up 2.2 percent from last year.

A strong dollar benefits IT companies

Another major reason for this bumper rally in IT shares is the ever-increasing strength of the US dollar. Currently the dollar index is trading around the 102.6 level. This is its highest level in the last 18 months. The dollar index primarily measures the dollar’s strength against a basket of six major global currencies. The fall of the Indian rupee against the dollar has given a new boost to the IT sector.

It is very easy to understand why IT companies benefit from dollar appreciation. In fact, most Indian IT companies provide their services in America and European countries. Most of their earnings come directly in US dollars. When the rupee weakens against the dollar, these companies make more money by converting their dollar earnings into rupees. This automatically increases their total earnings (topline) significantly. This dollar strength is driving IT stocks in the market today.

A new record in deal bookings

HCL Tech has surprised the market not only in profits but also by winning new projects. The company’s total deal bookings in the second quarter were $3.3 billion. If we look at the annual basis, there has been a huge jump of 27 percent. Due to this outstanding performance, the company’s first half deal bookings have reached their all-time record high. Getting new deals means the company has no shortage of work for the future.

Encouraged by these outstanding results, HCL Tech has also raised its revenue growth forecast for FY2027. Earlier the company had estimated 1 to 4 percent growth on a constant currency (CC) basis. Now the management has increased it from 2.5 to 4 percent. This increase in growth guidance sends a very clear and positive message to investors that the company is fully poised to achieve good growth in the coming period.

Midcap IT stocks also saw gains

This storm of big stocks had a direct impact on small and medium IT companies as well. Not only the giants but also the midcap stocks were seen trading in the green in the market. Midcap stocks like Mphasis, LTIM, Coforge, Persistent Systems and Oracle Financial Services Software (OFSS) also registered significant gains of over one percent.

The positive vibe that TCS had started creating in the market with its results, was given a new height by the outstanding performance of HCL Tech. Besides, the recent slowdown in AI business in the global market has also drawn investors’ attention to India’s traditional and strong IT companies. Market experts also believe that the IT sector will continue to support the stock market in this way as long as the deal pipeline of these companies remains strong and they continue to receive dollar support.