Motilal Oswal maintains a cautiously optimistic outlook for the Indian IT sector in 2026, anticipating an AI-led revival despite near-term challenges like seasonal furloughs and wage pressures. The brokerage expects muted growth in the current fiscal's second half but foresees a gradual recovery driven by AI adoption and scaled deployments in application modernization and data engineering. Infosys and Coforge are highlighted as top stock picks with significant upside potential.