IT stocks surge up to 6% on strong Infosys Q3 results, Nifty IT index hits three-week high

IT stocks surge up to 6% on strong Infosys Q3 results, Nifty IT index hits three-week high

• Infosys Q3 earnings lift Nifty IT index by 3%, Infosys shares up 6%
• LTIMindtree wins Rs 3,000 crore CBDT AI project for tax analytics modernization
• Infosys raises FY26 revenue growth forecast to 3-3.5%, boosting IT sector outlook

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The shares of IT companies jumped in trade on January 16 as strong Q3 earnings of Infosys boosted investor sentiment.

The Nifty IT index jumped more than 3 percent to 39,099.95, emerging as the top sectoral gainer on the market today. The index which was the worst performing sector in 2025, has now recorded the sharpest gains in three weeks.

Infosys Q3 Results:

Infosys shares led gains, jumping nearly 6 percent to trade at Rs 1,693 apiece. This comes after Infosys reported a consolidated net profit of Rs 6,654 crore for Q3 FY26, marking a 2.2 percent year-on-year (YoY) fall from the Rs 6,806 crore net profit reported in Q3 FY25. This however included Rs 1,289-crore one-time cost on account of new labour codes.

The IT major’s revenue from operations meanwhile rose 9 percent YoY to Rs 45,479 crore. The company revised its fiscal ending 2026 revenue growth forecast upwards to 3-3.5 percent, from an earlier estimate of 2-3 percent.

Other IT gainers today:

Oracle Financial Services Software and LTIMindtree shares gained more than 5 percent each. Notably, LTIMindtree said it has been awarded the Insight 2.0 project by the Central Board of Direct Taxes (CBDT) to build an AI-powered programme for the modernisation of India’s national tax analytics platform. The project, which is expected to be completed within seven years, is valued at around Rs 3,000 crore.

Tech Mahindra and Mphasis shares gained around 5 percent each, while Wipro shares were up more than 3 percent. Tech Mahindra and Wipro are set to release their results for the October-December quarter of the ongoing FY26 later today.

Persistent Systems and Coforge shares gained around 3 percent, while Tata Consultancy Services (TCS) and HCLTech shares rose over 2 percent each.

What lies ahead for IT sector?

Axis Securities remained ‘cautiously optimistic’ for the Indian IT sector. It noted that Infosys’ sequential growth trajectory suggests a stable environment rather than an improving one. “From a near-term perspective, global uncertainties will keep overall growth muted. However, the company’s core efficiencies, investments, and deal momentum across regions will support the overall business over the next couple of quarters,” the domestic brokerage said.

Infosys’ latest print matters because it is less about a one-quarter beat and more about a demand inflection signal, said Harshal Dasani Business Head INVasset PMS. The analyst said that the company raising its guidance and positive management commentary came at time when the market was questioning the durability of the IT cycle. That helped lift the Nifty IT index meaningfully in today’s session and provided a sentiment tailwind to the broader market.

“The setup is encouraging because IT valuations had become more reasonable after underperformance, and even modest upgrades can trigger short-covering. However, a sustained index breakout needs earnings breadth beyond IT—financials, consumption, and industrial capex must also deliver. So, Infosys can be a catalyst for confidence, but new highs are ultimately a function of aggregate earnings visibility and global liquidity,” he added.

A positive earnings outcome and a better outlook help signal that demand conditions in key overseas markets may be stabilizing, which supports overall risk appetite, said Ravi Singh, Chief Research Officer at Master Capital Services. He added that as confidence builds, this could lead to short-term momentum not only in IT but also in other industries.

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