Major Indian IT service providers, Tata Consultancy Services (TCS) and HCL Technologies, have seen their shares fall to 52-week lows, reflecting a cautious outlook for the sector. The downturn follows the recent launch of a new artificial intelligence (AI) model, Claude Fable 5, by Anthropic, which analysts believe poses a significant risk to the revenue streams of domestic technology companies.
The Nifty IT index has experienced a 26% drop this year, underscoring the broader market anxiety regarding AI-led disruption. Both TCS and HCL Technologies shares hit their lowest points in the previous trading session, with experts now evaluating their future trajectory.
TCS Shares Face Sustained Downtrend
India's largest IT firm, Tata Consultancy Services Ltd (TCS), saw its shares dip 2% to a new 52-week low of Rs 2110. The stock has shed 34% in 2026 alone and a total of 38% over the past year. Technical analysts largely concur on a bearish outlook for TCS.
- Virat Jagad, Sr. Technical Research Analyst at Bonanza, noted that TCS is trading near its 52-week low, indicative of persistent weakness and a bearish market structure. He highlighted the stock's position below key Exponential Moving Averages (EMAs) and an RSI below 40, signaling subdued momentum. Jagad suggested that a break below Rs 2,087 could intensify selling pressure, while sustained trading above Rs 2,209 might signal a potential rebound.
- Hitesh Rathi, Technical Analyst at Angel One, echoed the bearish sentiment, pointing to a consistent lower-high, lower-low structure. Rathi identified a crucial support zone between Rs 2180–2150, aligning with the 78.6% Fibonacci retracement from 2020 lows. While a temporary relief rally might occur at this level, he stressed that the broader technical structure remains bearish, with no clear signs of reversal.
- Hitesh Tailor, Technical Research Analyst at Choice Broking, observed a weak technical structure on the weekly chart after a decisive breakdown of key support levels. He indicated immediate support around Rs 2,000–2,050, with resistance near Rs 2,250. Despite an oversold RSI, the overall bias remains cautious as long as the stock trades below key moving averages.
HCL Technologies Also Hits New Lows
HCL Technologies, another Sensex component, also experienced a significant decline, with shares dropping 4% to a fresh 52-week low of Rs 1090. The stock has lost 33% in 2026 and 34% over the last six months, having peaked at Rs 1770 on February 3, 2026.
- Virat Jagad commented that HCL Technologies has entered a strong corrective phase after breaking below the critical support zone of Rs 1,240–1,250. He identified immediate resistance at Rs 1,170 and Rs 1,240, with support around Rs 1,020. A breach below Rs 1,020 could accelerate selling towards Rs 900–850, maintaining a bearish outlook until the stock reclaims Rs 1,240.
- Hitesh Rathi confirmed the primary downtrend for HCL Tech, characterized by a sequence of lower highs and lower lows. He anticipates the downtrend to extend towards the Rs 900 level. However, Rathi noted early signs of selling exhaustion and a bullish divergence in the 14-day Smoothed RSI, suggesting a potential short-term relief rally towards the Rs 1150–1200 zone.
- Hitesh Tailor pinpointed immediate support for HCL Tech around Rs 1,000–1,050, with resistance levels at Rs 1,200 and then Rs 1,300–1,390. Similar to TCS, he suggested a 'buy-on-dips' approach might be considered due to the oversold RSI and proximity to a long-term support zone, but warned that a cautious near-term bias persists.
The overall sentiment for the IT sector remains guarded as the industry grapples with the potential disruptive impact of advanced AI models on traditional revenue streams.