J.P. Morgan India FTM 25 Jun 26 India IT Services; India Cement Sector and More

Research evidence excerpt

J.P. Morgan India FTM 25 Jun 26 India IT Services; India Cement Sector and More

Asia Pacific Equity Research

Due to market closures, there will be no publication of India First to Market on 26 June. Publication resumes

on 29 June.

India First to Market 25 June 2026

Top Stories

| India IT Services (Ankur Rudra, CFA/Bhavik Mehta, CFA)

Numbers vs. narrative: Moderating medium-term estimates as the tension continues - 1QFY27

preview; downgrade HCLT, WPRO, TATATECH to UW

India IT faces an uncertain demand environment from an unprecedented confluence of technology and business cycle

headwinds from GenAI-led deflation and geopolitics. Enterprises face FUD (fear, uncertainty, doubt) from changing tech and

geopolitics, with tech services budgets crowded out from spending on AI tokens and cloud keeping industry growth recovery

prospects uncertain. Indeed, the IT services industry has been stuck at 2-3% revenue growth over the last three years. With AI

deflation still only in Year 2, we see further headwinds to growth over the next two years. In light of this uncertainty around the

timing of the positive inflection, we moderate our medium- to long-term growth estimates. We do not expect large-caps to hit

mid-single-digit growth and hover around 3-4% revenue growth. Reverse DCF sanity checks drive target P/E multiple cuts of

10-25% across the board. We downgrade HCLT and Wipro to UW from N, as we see sharp downside to consensus estimates

not fully captured by price action so far (down 31%/33% YTD vs. NSEIT 29%). We downgrade TATATECH to UW, as we

believe its sharp price action more than bakes in outperformance. Our top OWs remain TCS, Infosys, TechM, Coforge,

Persistent and Sagility.

India Cement Sector (Sanjay Mookim)