India Tech Stocks Face Reality Check as Investors Rush Into AI
May 17, 2024 - bloomberg.com
Shares of India's IT outsourcing firms, including industry leader Tata Consultancy Services Ltd., are experiencing a downturn as global investors shift their focus to artificial intelligence (AI). Unlike their counterparts in the developed world and China, Indian software makers have not made significant progress in generative AI.
This lack of advancement in AI, coupled with an uncertain outlook for client spending, could soon make these firms appear outdated. The shift in investor interest suggests that these once highly valued tech stocks may be left behind as the global tech industry moves towards AI.
Key takeaways:
Shares of India's IT outsourcing firms are facing a reality check due to the global investors' rush into the artificial intelligence theme.
These firms are being left behind by pricey old-economy tech stocks.
Indian software makers, including leader Tata Consultancy Services Ltd., have yet to make significant advances in generative AI.
The cloudy outlook for client spending may soon make these firms look like outdated tech bets.
