IT mid-cap vs large-caps: The Indian IT stocks are experiencing a strong comeback after seeing sharp decline over the past few months. Nifty IT ended nearly 2.88% higher on Wednesday, extending its gains after posting its biggest weekly rise in 18 years last week.
While IT large-cap names like Tata Consultancy Services (TCS), Infosys and Wipro emerged as the key contributors to the Nifty IT rally, mid-cap IT stocks such as Persistent Systems, Coforge, Tata Technologies and Mphasis lagged behind. Are we seeing a divergent trend in the IT stocks? Expert decodes.
Large-cap IT vs mid-cap IT stocks: Which segment leads the Q2 results race?
The recent rally IT stocks has come after IT heavyweights like TCS, Wipro, HCL Technologies, Tata Technologies, etc announced their earnings for the second quarter of financial year 2026-27. While mid-cap names are leading the Q2 results race in terms of growth, large-caps are ahead in terms of exceeding expectations.
“Persistent grew 7.8% quarter-on-quarter in constant currency. The large-caps that have reported grew between 0% (Wipro) and 2.4% (Tech Mahindra). But large-caps went in with a very low bar and cleared it. TCS’s ₹13,884 crore profit was ahead of estimates.”
“HCLTech raised the lower end of its FY27 guidance to 2.5–4% from 1–4%. Margins held or expanded across the group,” explained Gaurav Garg, Head – Research, Lemon, adding that an upgrade to Infosys’ guidance in its upcoming Q2 results would further reinforce the large-cap IT stocks’ lead.
Why is there a divergent trend in mid-cap and large-cap IT stocks?
“This was less large versus mid, and more cheap-and-hated versus expensive-and-loved. In the week to 16 October, TCS, Infosys, HCLTech and Wipro each gained 13–14%. Over the same week Persistent slipped 0.5%, and Coforge and Mphasis gained only 4.5-6%,” added the expert.
