3 min readMumbaiUpdated: Jun 20, 2026 05:40 AM IST
The Indian IT sector felt the tremors, with domestic shares of Indian IT services players falling as much as 8% on Friday, after global technology giant Accenture slashed its revenue growth guidance for the financial year and flagged a weaker demand outlook during its Q3 earnings late on Thursday.
The Irish IT powerhouse cut its revenue guidance for the financial year ending August 2026 to between 3-4% from the previous forecast of 3-5% in constant currency terms. The company also flagged on its earnings call that client budgets remain lukewarm despite higher AI spending, and that demand for its consultancy services remains weak.
Forecasts from global IT majors such as Accenture paint a picture for the future earnings performances for Indian IT majors, who often depend on a similar pipeline of US- and Europe-based clients for a majority of their revenue. A weaker demand environment flagged by global IT majors would also mean weak earnings growth in the future for top Indian IT services players.
Subsequent to Accenture’s results, Indian IT services majors fell as much as 8% in early trade on Friday. At 12:35 PM, the Nifty IT was down 1,455.90 points or 5.1% at 27,010.55 and was the worst-performing sectoral index. Big names such as TCS, Infosys, Wipro, and HCL Tech were down 3-8%. Others such as Coforge and Persistent Systems also traded 2-5% lower.
This fall in IT stocks pushed the overall market down, with the BSE’s Sensex index trading 756.97 points or 1% lower at 76,653.01. The National Stock Exchange’s Nifty 50 index was also down 0.9% at 23,960.
“By nudging its constant-currency revenue growth guidance down to 3–4% (from 3–5%), and its core commercial guidance down to 4–5% (from 4–6%), Accenture has effectively confirmed that clients remain highly cautious with their wallets. Because Indian IT firms rely heavily on the same global pipeline for discretionary tech projects, this shift in Accenture’s forecast serves as a macroscopic warning for the entire sector, prompting investor’s selloffs” according to Shashwat Singh, fundamental analyst at Bajaj Broking.
Post Accenture’s earnings, global firm Citi said it remains cautious on the Indian IT sector, flagging that the Nifty IT trades at a significantly higher valuation (16 times its 1-year forward earnings) than Accenture (10 times its 1-year forward earnings), CNBC reported. “We have been cautious given AI disruption, increased competitive intensity, GCC trends, etc.; the macro uncertainty increases the challenges near term,” Citi said.
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Other firms also flagged near-term challenges for Indian IT services names. “We believe the Middle East conflict is expected to have some effect on the revenues and deal bookings in 1QFY27F. In our view, the indirect impacts can continue in 2QFY27F, as it is not clear how quickly spending behaviour will normalise, particularly in challenged sectors like automotive,” Nomura noted.
