Forming a Contrarian View on Indian IT Amid AI Disruption Fears
Built an independent investment case for Indian IT companies at a time of broad market pessimism driven by AI disruption concerns
Apoorv Sharma
Equity Research Intern at CLSA
From their time as
Investment Coordinator
Management Development Institute, Gurgaon • 2025 - 2026
Overview
Apoorv formed an independent view on Indian IT companies at a point when the sector was broadly out of favor. The market narrative centered on AI disruption: that tools from firms like Anthropic and OpenAI would erode the consulting and implementation revenues that Indian IT companies depend on. Valuations reflected that fear, with significant multiple compression across large-cap and mid-cap IT names.
The Story
Apoorv formed an independent view on Indian IT companies at a point when the sector was broadly out of favor. The market narrative centered on AI disruption: that tools from firms like Anthropic and OpenAI would erode the consulting and implementation revenues that Indian IT companies depend on. Valuations reflected that fear, with significant multiple compression across large-cap and mid-cap IT names.
Apoorv examined the evidence on the other side. AI-related revenue at leading Indian IT firms was growing. Order books were at record highs. Management had publicly committed to revenue growth guidance and margin stability. Companies were deploying capital toward AI infrastructure, not retreating from the technology.
He also looked at the competitive reality. The offshoring model represents a structural cost advantage that AI consulting announcements from newer entrants do not replicate. Those announcements, in his view, were partly driven by funding and IPO positioning narratives rather than demonstrated delivery capability at enterprise scale.
His read: the AI fears were overblown relative to the evidence, the valuations were cheap given the cash flows and order book, and the moat around offshore delivery remained intact. He held the position as a contrarian call.