Overview

• Previews point to flat to marginal sequential growth for Tier-1 firms in Q2 FY26, with guidance ranging from roughly 0.6% to 1.8% and mid-tier players expected to outpace larger peers.
• Analysts flag U.S. policy pressures—including steep H1-B fee hikes, a proposed outsourcing tax, and reciprocal tariffs—that are clouding demand visibility and raising delivery costs.
• Infosys and LTIMindtree are expected to lead large-cap growth, while TCS, HCLTech, Wipro, and Tech Mahindra are seen posting largely flat trends according to brokerage estimates.
• Deal flow is concentrated in cost take-out and infrastructure modernisation, while AI projects are moving from pilots to production but revenue conversion remains slow.
• HDFC Securities trimmed sector estimates and upgraded Infosys and HCLTech to Buy, noting the IT index is down about 13% in three months and Tier‑1 valuations appear reasonable.