India’s information technology sector is heading into Q4 earnings season with growth expected to remain subdued and deal momentum uneven. A March 2026 preview by Motilal Oswal indicates that recent narrative shocks and global uncertainty have weighed on sentiment, even as earnings expectations have not seen sharp downgrades. Within this backdrop, the brokerage has identified a handful of companies where execution strength and business mix offer relative comfort.
The note points to modest sequential growth, mixed margin trends and cautious management commentary in the near term. Even so, it retains a preference for select large-cap and midcap names where demand visibility and deal pipelines remain intact.
Motilal Oswal on Infosys: ‘Buy’
Motilal Oswal continues to prefer Infosys among large-cap names, maintaining a ‘Buy’ rating. It expects the company to guide for revenue growth of about 1.5% to 4.5% year-on-year in constant currency for FY27, with near-term performance reflecting a stable but subdued environment.
Margins are expected to remain within the guided band, though the brokerage notes risks from slower product growth and productivity pressures.
“On guidance, exit rates for large-caps now appear relatively favorable. However, we expect companies to exercise caution in light of the current geopolitical environment,” Motilal Oswal says.
The firm also points out that growth could see some moderation due to macro headwinds and project ramp-downs.
Motilal Oswal on HCL Technologies: ‘Buy’
Motilal Oswal has a ‘Buy’ rating on HCL Technologies. The brokerage expects the company to remain among the faster-growing large-cap firms, supported by its diversified portfolio and steady execution, even as demand conditions remain uncertain. It notes that services growth could stay resilient, although margins may face pressure from wage hikes and restructuring costs.
“We like HCLT as the company remains the fastest-growing large-cap IT services firm, and we like its all-weather portfolio, which continues to outperform in an uncertain demand environment,” Motilal Oswal says.
The brokerage adds that margin expectations could face downside risks if productivity gains fall short or cost pressures persist, though the company’s positioning across verticals provides some cushion.
Motilal Oswal on Tech Mahindra: ‘Buy’
Motilal Oswal has assigned a ‘Buy’ rating to Tech Mahindra. The brokerage sees early signs of improvement under new leadership, particularly in execution and business focus, although it notes that recovery is still in early stages.
It expects modest growth in the near term, supported by operational improvements and cost measures, with margin expansion likely to be gradual.
“For TECHM, we see signs of transformation under the new leadership and improving execution in BFSI. We believe TECHM’s transformation remains relatively decoupled from discretionary spending,” Motilal Oswal says.
The firm indicates that sustained execution and stabilisation in key verticals will be critical for further improvement.
Motilal Oswal on Coforge: ‘Buy’
Motilal Oswal maintains a ‘Buy’ rating on Coforge, naming it its top pick among mid-cap companies. The brokerage expects the company to benefit from a strong executable order book, steady client spending and gains from recent acquisitions.
It anticipates Coforge to be among the better performers within mid-tier firms, aided by improving margins and easing wage-related pressures.
“We believe COFORGE’s strong executable order book and resilient client spending across verticals bode well for its organic business. Encora’s acquisition expands COFORGE’s presence in the Hi-Tech and Healthcare verticals,” Motilal Oswal says.
The brokerage adds that the company remains well placed to benefit from vendor consolidation and digital transformation deals.
Sector view from Motilal Oswal
Motilal Oswal’s broader assessment suggests a muted quarter ahead, with large-cap companies expected to report sequential growth in the range of minus 1.0% to 1.5% in constant currency, while mid-cap firms may do relatively better.
“Q4 results are likely to mirror this set-up, with QoQ growth expected in the range of -1.0% to 1.5% for large-caps, and midcaps expected to outperform once again,” Motilal Oswal says.
Margins are expected to remain range-bound across several companies, with some facing pressure from wage hikes and restructuring costs.
“We expect margins to be range-bound for TCS, INFO, MPHL, and PSYS. We expect a margin contraction for Wipro and HCLT,” Motilal Oswal says.
The brokerage also notes that banking and financial services remain relatively stable, while manufacturing demand is mixed and travel-related segments could see some impact from geopolitical concerns.
Conclusion
Motilal Oswal’s latest sector note points to a subdued near-term outlook for information technology companies, with growth staying modest and margins under pressure in parts of the sector. Even so, the brokerage continues to favour select names where execution, deal visibility and portfolio mix offer some resilience.
HCL Technologies and Tech Mahindra stand out among large-cap companies, while Coforge leads in the mid-cap space. Infosys remains among the preferred picks, supported by its scale and relatively steady outlook. The note suggests that while broader sector momentum has slowed, a few companies still offer relatively better earnings visibility in an uncertain environment.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.
