J.P. Morgan downgraded the ratings of six Indian IT companies due to concerns about the impact of artificial intelligence.

Jefferies downgraded ratings for six Indian IT companies, citing the anticipated impact of artificial intelligence tools that is expected to bring about structural changes in the business. Jefferies lowered the rating of India's largest IT exporter, Tata Consultancy Services, from "hold" to "underperform the market"; downgraded the ratings of Infosys and HCL Technologies from "buy" to "hold"; downgraded the ratings of LTI Mindtree and Hexaware Technologies to "underperform the market", and downgraded the rating of Mphasis to "hold". The Indian Nifty IT index dropped 1.1%, making it the worst performing sector among major industries. Jefferies stated that artificial intelligence may shift the IT business structure towards consulting and implementation, while reducing the scale of managed services. This not only increases industry cyclicality, but also requires companies to adjust their talent structure and operating models, thereby exacerbating risks.