Indian information technology companies lost nearly Rs 2 lakh crore in market capitalisation on Wednesday in their worst session in several years after Anthropic launched a new enterprise AI automation tool that sparked fears it could eat into the core businesses of data and information services firms. The Nifty IT index comprising of 10 largest companies ended nearly 6% lower, the biggest single day fall in six years.
Infosys Ltd. and Tata Consultancy Services Ltd. fell the most.
Anthropic included a legal tool on its website that it says it can automate work like contract reviewing and legal briefings. “All outputs should be reviewed by licensed attorneys,” according to the website.
The development triggered a sharp rout in US and European data analytics, professional services and software stocks with big names like Accenture Plc. and Cognizant Technology Solutions Corp. shedding over 9% on Tuesday. The tech-heavy Nasdaq 100 Index closeed 1.6% lower.
Indian IT firms still rely heavily (60–70%) on human‑led service models, making them more vulnerable to automation-driven disruption. The AI adoption could lead to 20-25% cost reductions, as per analysts, raising concerns about reduced demand for manual workforce‑based services.
The pressure is mounting on sector giants like TCS, Infosys, Wipro, and HCL Tech to accelerate AI, cloud, and automation offerings. The long-term narrative will hinge on how effectively companies balance human expertise with AI‑driven capabilities.
Anthropic, founded in 2021 by former members of OpenAI, is part of a rash of AI startups developing tools for the legal industry. The company’s AI coding tool, Claude Code, was publicly launched only in May last year and reached $1 billion in annualised recurring revenue by November, as per reports.
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