Nifty IT Index Rallies around 5% in Two Sessions; Infosys Buyback, TCS Outlook and Oracle Boost in Focus

The Nifty IT index has staged a sharp recovery, gaining around 5% over the last two sessions, despite the broader market exhibiting mixed trends. The rebound in IT stocks follows weeks of underperformance, with sentiment improving due to company-specific developments, global cues, and investor expectations.

On Thursday morning, however, the index is trading 0.89% lower at 35,861.80 levels, mainly due to profit-booking. Despite this dip, IT stocks remain in the spotlight, driven by three major factors.

Infosys Buyback Proposal Sparks Optimism

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Infosys, India’s second-largest IT services company, is at the centre of market attention as its board meets today to consider a share buyback proposal. If approved, this would mark the firm’s fifth such exercise.

The company’s stock has rallied nearly 7% in just two sessions since news of the proposal surfaced. Infosys last conducted a buyback in 2022, spending ₹9,300 crore at a maximum price of ₹1,850 per share.

The potential buyback has not only boosted investor confidence in Infosys but has also lifted sentiment across the IT sector. Analysts believe the move could encourage other IT majors to follow suit, rewarding shareholders and making the stocks more attractive in a challenging demand environment.

CLSA Maintains Positive View on TCS

Global brokerage firm CLSA has turned optimistic on Tata Consultancy Services stock (TCS), citing attractive valuations and positive catalysts such as U.S. Fed rate cuts, the resolution of the U.S.-India trade dispute, and growing AI-driven demand.

TCS’s management has highlighted that overall IT budgets are likely to expand due to AI adoption, creating revenue growth opportunities. CLSA added that with Infosys considering a buyback, pressure could mount on TCS to undertake a similar exercise as a show of confidence. Reports suggest the company may opt for a tender-offer style buyback worth around ₹20,000 crore.

Oracle’s Record-Breaking Rally Boosts Sentiment

Oracle Corporation provided another boost to IT sentiment after its shares surged 43% on Wall Street, hitting a record high and edging closer to a trillion-dollar valuation. The rally followed the announcement of four multi-billion-dollar contracts, driven by surging demand for computing capacity in the global AI race.

In India, Oracle Financial Services Software (OFSS), the company’s subsidiary, initially rallied over 10% on Wednesday and gained another 3.6% in early Thursday trades. However, OFSS later clarified that Oracle’s global contracts would not directly impact its business.

Morning Trade Snapshot

In Thursday’s opening session, the Nifty IT index slipped marginally as investors booked profits. Infosys share price traded about 1% lower ahead of its board meeting, while most other constituents, barring TCS and OFSS, were in the red.

Conclusion

The IT sector’s rebound highlights renewed investor interest amid expectations of share buybacks, AI-driven opportunities, and strong global technology cues. However, analysts caution that sustained momentum will depend on demand recovery and concrete earnings growth in the coming quarters.