Nifty IT Takes a 12% Hit in September Amid US Uncertainty

The Nifty IT index has taken a beating in September, plummeting by nearly 12% and ending lower in 16 of its 20 trading sessions. The decline is roughly double that of the benchmark Nifty 50's 6% fall so far this month.

Investors are bracing for the impact of US policy uncertainty, weak growth, margin pressure, and concerns over artificial intelligence on traditional IT services. Indian IT companies, heavily reliant on the US market, face increased operating costs due to higher visa fees and levies on IT remittances.

LTIMindtree has fallen 15.81% in September, while Oracle Financial Services Software (OFSS), Coforge, Wipro, and Tata Consultancy Services (TCS) have declined by double-digit percentages. HCLTech and Tech Mahindra are down 7.15% and 7.95%, respectively.

Growth slowdown and AI concerns are weighing heavily on the sector, with discretionary technology spending remaining weak and automation putting pressure on traditional services. Prathamesh Kadival of Bonanza notes that 'real growth is near a standstill and earnings momentum is fading.'