With Donald Trump back in the White House, Indian stocks could either ride the wave or get dragged under by his wildcard policies.
But one sector seems ready to thrive regardless: tech.
Indian IT giants — Infosys, TCS, HCL and Tech Mahindra — have survived the dot-com bubble, cloud transitions and the immigration drama during Trump’s first term.
They’ve seen this movie before and know how to adjust the script.
“I’m bullish,” says Maneesh Dangi, co-founder at Macro Mosaic Investing and Research, a cross-asset outfit. Trump’s policies, paired with the AI boom, could push these firms higher, he tells MONIIFY.
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The case for IT
Despite Nifty 50’s 10% drop since September, which mirrors the overall uncertainty from Trump’s iffy rhetoric, tech looks solid.
Analysts expect Infosys and TCS to gain 10% over the next year, according to LSEG data. Wipro shares just jumped 8% on Monday after hinting at a recovery in discretionary spending.
One driver for Indian IT could be Trump’s proposed tax cuts for corporate America. This could be a potential catalyst for IT demand and a positive for stocks like Infosys, TCS, HCL, and Tech Mahindra, according to Nitin Aggarwal of Client Associates, a wealth manager.
Analysts like Macro Mosaic’s Dangi argue digital transformation and AI adoption will eventually be real drivers, outweighing any immigration or outsourcing roadblocks.
That being said, the bigger picture for IT is not all that rosy.
Step outside the US, and it’s not all smooth sailing. Europe’s slowing growth could offset gains from a US rebound. Any improvement, analysts at Ambit Capital say, will likely be modest.
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Who loses?
Industries like pharma, textiles and manufacturing face mixed prospects.
Pharma giants like Sun Pharma and Aurobindo Pharma might dodge tariffs, as levies could backfire by raising US healthcare costs.
The textile sector, which exported $10 billion worth of goods to the US last year, appears more vulnerable. Exporters like Arvind and Welspun Living could land in Trump’s crosshairs if he targets imports to protect US industries.
Chemicals and electronics manufacturers may benefit if Trump disrupts China’s supply-chain dominance, according to Amit Khurana, head of equities at Dolat Capital. Indian manufacturers who’ve recently expanded capacity might find themselves in the right place at the right time.
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But the uncertainty is real, and gains are far from guaranteed. As an investor, perhaps it’s best to home in on the brightest spot?
While risks abound, tech’s adaptability and alignment with global trends like AI keep it a standout. If Trump’s policies favor innovation and corporate spending, Indian IT could win out despite the unpredictability.
Edited by Ankush Chibber. If you have any tips, ideas or feedback, please get in touch: talk-to-us@moniify.com
