TCS vs Infosys vs Wipro: Which IT Stock Holds the Edge as the 2024 US Presidential Election Looms? Experts Weigh In

TCS vs Infosys vs Wipro: As the 2024 US presidential election nears, India’s IT sector is on high alert, anticipating potential policy shifts that could impact its operations. Analysts suggest that TCS and Infosys may benefit from a steady demand environment, even as the Nifty IT index demonstrates resilience despite recent drops. The election outcome could bring changes to trade policies, visa regulations, and the dollar’s movement—all crucial for Indian IT companies.

Despite challenges such as demand slowdowns and elevated interest rates in key markets, the IT sector has outperformed. The Nifty IT index has risen by 31% over the past year, outpacing the Nifty 50, which has seen a 25% gain.

IT stocks like Persistent Systems (up 71%), Coforge (up 48%), Tech Mahindra (up 45%), Wipro (up 41%), and HCL Tech (up 39%) have performed well over the past year. Meanwhile, Infosys (up 27%) and TCS (up 18%) have trailed behind the index.

TCS vs Infosys vs Wipro: The US Election and Its Potential Impact on the Indian IT Sector

TCS vs Infosys vs Wipro: The US remains a critical market for Indian IT firms, and election outcomes could affect H-1B visa policies and taxes on companies that outsource, potentially shaping the sector’s future.

Trivesh D, COO of Tradejini, noted that the Indian IT sector has generally shown resilience during major US events, including previous elections, despite the sector’s reliance on US clients. “Since 2020, the Nifty IT index has gained 104%, underscoring the sector’s strength despite recent pullbacks. If the Fed implements rate cuts or BFSI spending picks up, Indian IT firms could benefit further, especially with key support levels for Nifty IT at around 39,800,” he added.

TCS, Infosys, and Wipro: Expert Picks Ahead of the Election

Several analysts shared their perspectives on TCS, Infosys, and Wipro as the election approaches.

Prashanth Tapse, Senior VP (Research) at Mehta Equities

TCS vs Infosys vs Wipro: Tapse cautioned against focusing too heavily on individual stocks right before the election outcome. He views the sector outlook as cautiously optimistic, though he acknowledges uncertainties if Trump is elected. “Any impact would likely be short-term. We believe much of the risk is priced into the Nifty IT index, with limited downside from current levels,” Tapse stated. He noted technical levels of interest: Infosys at ₹1,733, Wipro appearing weak at ₹541, and TCS neutral at ₹3,946.

Sagar Shetty, Research Analyst at StoxBox

With the election just a day away, Shetty believes market clarity will improve once the results are in, stabilizing investor sentiment. “Our positive outlook on TCS is due to its strong market position, broad product range, and deep talent pool. We expect GenAI-led growth to further boost its revenue visibility,” said Shetty.

Ajit Mishra, SVP, Research at Religare Broking

Mishra pointed out that the Nifty IT index recently dipped, hovering near a key support level aligned with the 100-day exponential moving average (DEMA). “Infosys has shown resilience, pulling back only slightly from its peak. Strong support at ₹1,680 makes it a viable choice for gradual accumulation with a medium- to long-term outlook,” Mishra added.

Aspect	TCS	Infosys	Wipro
Market Position	Strong market leader, broad product offerings	Resilient performance, slight pullback from high	Weaker performance on charts
Current Price Level	₹3,946 – Neutral (Tapse)	₹1,733 – Good Buy (Tapse), ₹1,680 – Strong Support (Mishra)	₹541 – Weak (Tapse)
Key Analyst Perspective	Positive outlook due to strong position, talent pool	Cautious optimism, gradual accumulation for long-term	Weak technical outlook
US Policy Impact	Likely resilient due to diversified offerings	Expected stability, but election policy-sensitive	Uncertain, may be impacted by policy shifts
Growth Drivers	GenAI and improved deal execution (Shetty)	Support levels align with stable growth (Mishra)	No specific growth indicators noted
Election Impact Outlook	Limited downside risk	Strong support levels, medium- to long-term potential	May face pressure from uncertain policies

Conclusion

While each expert has a slightly different outlook, the consensus remains cautiously optimistic for the sector as a whole, with individual preferences for TCS and Infosys due to their resilient market positions and growth potential. Investors may wish to wait until after the election to gauge the sector’s direction further, as policy clarity unfolds.

Disclaimer: The views and recommendations here are those of individual experts and analysts. Investors should consult certified advisors before making any investment decisions.