IT Stocks Rebound Amid Market Weakness; Kotak Flags AI-Driven Risks to Sector Growth

IT stocks rebounded on March 6 despite broader market weakness, with the Nifty IT index rising nearly 2% amid value buying after recent declines. Major firms like TCS, Infosys, HCL Tech, and Tech Mahindra saw gains, supported by a weaker rupee and export prospects. However, Kotak Institutional Equities warned of increased risks from generative AI disrupting traditional IT services, leading to lowered fair values and expectations of revenue deflation in FY27-FY28, while maintaining a long-term positive outlook on sector relevance.