TCS, Infosys, Wipro, LTIMindtree, HCLTech & More — Buy, Sell Or Hold? Q3 Expectations, Ratings Inside

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Yes Securities Report

Yes Securities expects the overall demand environment for IT services to remain broadly stable, though macroeconomic uncertainty continues to weigh on enterprise decision-making.

Discretionary spending remains limited across most verticals, with only selective pockets of demand visible within BFSI. Seasonal factors such as furloughs, combined with the prevailing macro headwinds, are likely to keep sequential revenue growth muted for most players in Q3FY26, despite resilience in core segments.

Cost takeouts still in flavor; FX supporting weak growth

Deal activity in the IT services sector continues to be driven by cost-takeout mandates, productivity-led transformation, and vendor consolidation, as clients focus on efficiency amid a muted demand backdrop. A weaker rupee is expected to partially offset subdued constant-currency growth and slightly negative cross-currency movements, providing support to reported margins and offering some relief to earnings.

BFSI leads the growth although seasonal furloughs weigh in

At a sectoral level, BFSI remains the most resilient vertical, delivering consistent performance across major IT players, supported by steady run-rate demand. Hi-Tech continues to maintain positive momentum, while manufacturing remains under pressure, primarily due to persistent weakness in the auto segment, though non-auto sub-segments show relatively better stability.

The retail vertical exhibits mixed trends, with HCLTech Ltd. and Tech Mahindra Ltd. witnessing early signs of recovery and ramp-ups, while other players continue to face uneven demand patterns.

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