Top IT stocks to buy after Q2 results: Indian IT companies delivered a mixed performance in the September quarter of FY27, with HCLTech and Tech Mahindra reporting strong earnings momentum, while Tata Consultancy Services (TCS) continued to benefit from its scale, deal pipeline and artificial intelligence (AI) opportunities. However, subdued client spending, pricing pressure and uneven revenue growth continue to pose challenges for the sector, according to market analysts.
Gaurav Garg, Head of Research at Lemon, said that investors should prioritise HCLTech and TCS for further evaluation, while considering Tech Mahindra only if they are comfortable with higher execution risks.
Meanwhile, Seema Srivastava, Senior Research Analyst at SMC Global Securities, also highlighted HCLTech’s operating momentum and TCS’s scale, profitability and AI-led growth opportunities.
TCS vs Infosys vs Wipro vs HCL vs Tech Mahindra: Which stocks remain top picks by experts?
Garg said HCLTech deserves attention because of its improved growth guidance, while TCS remains relevant for investors seeking exposure to a large, diversified IT services business with a strong contract pipeline and expanding AI capabilities.
“HCLTech stands out for improving growth visibility, while TCS remains a strong candidate for investors seeking scale and long-term AI opportunities,” Garg said.
He added that Tech Mahindra could appeal to investors comfortable with higher execution risk, given its strong quarterly growth, although the sustainability of its turnaround remains an important consideration.
Srivastava highlighted HCLTech’s strong operating performance and TCS’s combination of scale, cash generation and relatively stronger margins.
HCLTech could appeal to growth-oriented investors because of its improved guidance and margin expansion. TCS, meanwhile, may suit investors prioritising business scale, profitability and exposure to long-term AI-led opportunities.
However, investors should assess both companies’ valuations and earnings expectations before taking fresh positions. Strong quarterly results do not automatically mean a stock is attractively valued.
Tech Mahindra could be considered by investors willing to accept higher risk in pursuit of a potential turnaround. Its strong revenue and profit growth, improving EBIT and deal wins indicate better operating momentum.
However, the recovery needs to be sustained across multiple quarters. Investors should monitor margin expansion, deal wins and the consistency of revenue growth to determine whether the improvement represents a durable recovery rather than a one-quarter rebound.
For Infosys, the central issue is whether its large deal wins and AI-led demand can offset the impact of slower revenue growth and the reduced FY27 guidance. Investors should watch constant-currency revenue growth, deal conversion and operating margins for signs of stabilisation.
Wipro warrants greater caution because of its weak deal bookings and subdued revenue outlook. A sustained improvement in bookings, revenue growth and profitability would strengthen its investment case.
TCS vs Infosys vs Wipro vs HCL vs Tech Mahindra: What should investors do?
For investors already holding these stocks, the latest results should be assessed alongside their original investment thesis, current valuations and expected earnings trajectory rather than prompting an automatic buy or sell decision.
“Ultimately, buy decisions should also consider current valuations, risk tolerance and investment horizon; quarterly performance alone does not establish which stock offers the best return,” Srivastava added.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
