Indian information technology shares moved unevenly following Accenture’s robust fourth-quarter results, with market reactions reflecting a cautious outlook amidst mixed signals on client spending and deal activity.
Indian information technology shares moved unevenly on Monday after Accenture delivered a stronger-than-expected fourth-quarter performance, with investors weighing the positive signal on deal activity against lingering caution over client spending. HCL Technologies and Infosys came under pressure, while Tata Consultancy Services and Coforge advanced, leaving the Nifty IT index lower in early afternoon trade. At one point, the sector gauge had fallen 0.86 per cent before trimming losses, a sign that the market was treating the results as encouraging but not transformative.
Accenture said revenue for the quarter ended in August rose to $18.7 billion, up 7 per cent year on year in constant currency and above the top end of its guidance range. The company said the improvement was helped by smaller deals, faster ramp-up of newly won contracts, acquisitions and strength in its federal business. Adjusted operating margin widened by 20 basis points to 15.3 per cent, while new bookings increased to $22.17 billion. Analysts at ICICI Securities said the print should offer a broadly positive read-through for Indian IT names, though company-specific growth commentary will remain important.
Even so, brokerage commentary suggested that the underlying demand picture has not turned decisively more upbeat. Motilal Oswal Financial Services said Accenture’s management saw no meaningful sequential change in the environment, with discretionary spending still selective and the order book tilted towards large, multi-year outsourcing contracts. That points to a favourable backdrop for big deal wins, but not necessarily a broad revival in short-cycle spending. PL Capital said Indian IT firms are likely to see only a moderate improvement in the second quarter of fiscal 2027, citing macro headwinds, continued uncertainty in client budgets and the possibility that artificial intelligence projects will offset only part of the softness in traditional services.
Accenture’s own outlook underlined that caution. It forecast full-year revenue growth of 3 per cent to 6 per cent in local currency for fiscal 2027 and guided for an adjusted operating margin of 15.9 per cent to 16.1 per cent. The company also said it expects to return at least $9.5 billion to shareholders. In the Indian market, the reaction reflected that mixed message: investors welcomed a solid set of results, but the broader sector still appears sensitive to any sign that spending decisions remain restrained. The Nifty IT index, which tracks the country’s largest listed software exporters, has been volatile this year as traders assess deal wins, currency moves and the pace of AI-led change.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
