Trump’s H-1B visa fee hike: After the H-1B visa fee hike to $1,00,000, the IT stocks of the Indian stock market have been under sell-off heat for the last few sessions. IT majors — Tata Consultancy Services (TCS), Infosys, Wipro, HCL Technologies, etc.- came under selling pressure due to negative sentiments about Indian IT stocks. For a long-term investor looking for a value pick, this can be a good opportunity to include IT stocks in their portfolio, provided they have discounted Trump’s H-1 visa fee increase.
According to stock market experts, the H-1 visa fee hike has affected Indian IT stocks’ outlook for the short term, whereas the India-US trade deal and optimism about the US Fed rate cut are expected to boost IT stock bias in the long term. Besides these factors, the global push for digital transformation, AI, and cloud adoption continues to support the sector’s long-term prospects.
H-1B visa fee hike
Expecting the impact of the H-1B visa fee hike to fade out soon, Seema Srivastava, Senior Research Analyst at SMC Global Securities, said, “The proposed H-1B visa fee hike by Donald Trump poses a fresh challenge for the Indian IT sector, which has traditionally relied on deploying skilled professionals in the United States. This development could raise operational costs, especially for firms with high H-1B dependency, and adds to existing regulatory risks when the industry is already grappling with client caution and margin pressures. However, in the broader context, macroeconomic shifts may outweigh these negatives in the medium to long term.”
“A deeper analysis paints a more nuanced picture. For the top 10 Indian and India-centric IT service providers, H-1B visa holders represent less than 1% of their global employee base. This suggests that the direct impact on earnings in FY26 will likely be limited. Companies have already begun recalibrating their operating models, reducing reliance on H-1B visas, expanding local hiring in the US, and diverting more work to offshore delivery centres in India,” said Sugandha Sachdeva, Founder of SS WealthStreet.
Sugandha Sachdeva of SS WealthStreet said the revised H-1B visa fee structure will apply only to new applicants starting in 2026. It will give Indian IT companies sufficient lead time to realign strategies, strengthen skilling programs, and deepen investments in US local talent pools. In fact, Indian firms have already invested close to $1 billion in upskilling local workers in the US, signalling a clear pivot towards a more resilient and diversified workforce model.
US Fed rate cut in focus
“The US Fed rate cut optimism has improved liquidity and reduced financing costs, encouraging enterprises to increase IT spending. Simultaneously, the prospect of an India–US trade agreement has sparked optimism around reduced regulatory hurdles, stronger outsourcing opportunities, and deeper technology collaboration. These factors, along with the global push for digital transformation, AI, and cloud adoption, continue to support the sector’s long-term prospects,” Seema Srivastava of SMC Global Securities said.
IT stocks to buy
Asked about the outlook of major Indian IT stocks, Seema Srivastava said, “Among companies, TCS remains the industry’s bellwether, offering defensive stability, top-tier execution, and consistent returns, making it a core portfolio holding. Infosys provides a growth-oriented play, supported by large deal wins, strong digital services traction, and an improving demand outlook. HCL Tech’s strength in engineering, cloud, and infrastructure positions it well for discretionary IT spending recovery, albeit with some margin pressures, offering a balanced risk-reward profile. In contrast, Wipro lags peers with weaker growth and subdued deal momentum, making it suitable mainly for speculative investors. While near-term headwinds remain, the sector’s resilience makes current volatility an opportunity to accumulate quality IT names.”
Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
