How HCLTech defied the gravity of India's four-year IT slump
Out of India's top five IT stocks, only one pulled ahead in the last four years: HCL Technologies. The others either had nil returns, or even lost value. What made the Noida-based company stand out?
HCL Technologies Ltd has emerged as the sole bright spark in a four-year sombre stretch for India’s information technology (IT) investors, leveraging a stable leadership and an early pivot toward artificial intelligence (AI) to outpace its Big Five peers.
While the broader IT sector grappled with a post-pandemic hangover and the growing threat of automation, Noida-based HCLTech has delivered a 29% return since early 2022. That performance stands in stark contrast to the rest of the industry’s heavyweights, which have seen billions in market value evaporate as growth visibility dimmed.
Data compiled by Bloomberg shows that HCLTech shares climbed 28.86% between 1 January 2022 and 16 January 2026. During the same period, the remaining members of the Big Five slumped: Tata Consultancy Services Ltd (TCS) fell 14.2%, Infosys Ltd 11% and Tech Mahindra Ltd 6.7%, while Wipro Ltd fared the worst, plummeting more than 25%.
The divergence highlights a shifting pecking order in India’s $283 billion IT services export machine. HCLTech, the nation’s third-largest software services provider, has outgrown its peers in two of the last four years. It closed FY25 with $13.84 billion in revenue, up 4.3% annually, following a 5.4% expansion in 2024.
"Among the large-cap companies, we have delivered the highest growth in the last three years, and in the fourth year running, we would probably deliver the highest growth," HCLTech chief executive officer (CEO) C. Vijayakumar said in an interview last week. "Even though the growth is mid-single digit, it is definitely much higher than some of our peer group." The company is guiding for full-year growth of 4% to 4.5% in constant currency terms for the current fiscal year, maintaining stable operating margins despite a "constrained" global spending environment.
A critical factor in HCLTech’s resilience was its proactive stance on Generative AI. In October, it became the first of the Big Five to spell out specific revenue from AI, reporting over $246 million from advanced projects including "agentic AI," "AI factories," and physical AI.
"We have been much more proactive about the impact of AI and acknowledging that it will be a deflation in some services," Vijayakumar said. "We focused on what we can do to address it... which, of course, our investors are happy with."
Analysts at Motilal Oswal termed HCLTech’s business as "all-weather," noting its ability to outperform amid macroeconomic uncertainty and high interest rates in key markets like the US and Europe.
For the rest of the sector, the last four years have been a period of zero to negative returns. The euphoria of the pandemic era—when a rush toward digitization fueled double-digit growth—has been replaced by anxiety over slowing deal pipelines and potential tariff-led disruptions in Western markets.
"Investors sold IT shares because there was no growth visibility and AI-led uncertainty," Amit Chandra, vice-president at HDFC Securities said. "People did not know what the impact would be."
The struggle is most visible at Wipro. The Bengaluru-based firm has ended two of the last four years with declining revenue and faces a potential third. However, Wipro issued a 1:1 bonus in October 2024. To be sure, the management expects fourth quarter revenue to be in the range of $2.64 billion to $2.69 billion.
The performance gap also reflects a tale of two management styles. Vijayakumar, who took the helm in 2016, provides a sense of continuity that has eluded his rivals. In contrast, Wipro has seen three CEOs in the same period, with current head Srinivas Pallia taking over in April 2024.
"Weak outlook and a cautious demand commentary (from Wipro) are in contrast to the optimism in AI-led discretionary demand uptick commentary by large-cap peers," ICICI Securities analysts noted in a 17 January report.
To retain investor interest, HCL Tech's peers have leaned heavily on dividends, buybacks and bonuses. In the last four years, TCS, Infosys, HCLTech, Wipro, and Tech Mahindra have returned ₹1.5 trillion, ₹69,000 crore, ₹51,000 crore, ₹30,000 crore, and ₹16,000 crore to shareholders, respectively.
Market observers are now betting on a sector-wide recovery starting this year. Analysts at Axis Capital suggest that calendar year 2026 could mark a definitive pivot, ending a streak of disappointments. "A combination of growth pickup and currency tailwinds should support margins and earnings upgrades," Axis Capital analysts Manik Taneja and Rohit Thorat wrote. They expect "Tier-1 techs" to finally catch up to the "rate of change" excitement that has so far only benefited HCLTech. However, for now, HCLTech remains the only player that has successfully turned that promise into share price gains.
“The Indian IT services sector is positioned for a growth recovery starting in 2026, following a phase of muted performance from 2022 to 2025. The upcoming revival is expected to be underpinned by AI services, which are emerging as the key growth engine, as reflected in the increasing traction of AI-led deal wins," said HDFC Securities analysts Amit Chandra, Vinesh Vala, and Maitreyee Vaishampayan, in a note dated 8 December, 2025.
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