IT stocks dropped on Monday, with Infobeans Technologies tumbling nearly 9 per cent and Hexaware falling 7 per cent, amid concerns over the steep hike in US H-1B visa fees
NEW DELHI — IT stocks dropped on Monday, with Infobeans Technologies tumbling nearly 9 per cent and Hexaware falling 7 per cent, amid concerns over the steep hike in US H-1B visa fees.
Shares of Infobeans Technologies fell 8.93 per cent, Hexaware Technologies tumbled 7.08 per cent, LTI Mindtree tanked 4.54 per cent, Persistent Systems dropped 4.19 per cent, and Tech Mahindra declined 3.20 per cent on the BSE.
The stock of Tata Consultancy Services slipped 3.02 per cent, Infosys edged lower by 2.61 per cent, Wipro declined 2.25 per cent, and HCL Tech went down 1.84 per cent.
Together, these firms faced a combined erosion of INR 83,994.45 crore from market valuation in a single day.
Also read: Meta, Amazon urge H-1B employees to return to US ahead of $100,000 Visa fee deadline
The BSE IT index declined 2.73 per cent to 34,988.20.
"The correction was led by IT stocks as investor sentiment turned cautious after US President Donald Trump imposed a USD 100,000 fee on new H-1B visa applications, a move expected to disrupt India's USD 283 billion IT outsourcing model," Hariprasad K, Research Analyst and Founder at Livelong Wealth, said.
Falling for the second day in a row, the 30-share BSE Sensex dropped 466.26 points or 0.56 per cent to settle at 82,159.97. The 50-share NSE Nifty declined 124.70 points or 0.49 per cent to 25,202.35.
Read more: GST 2.0 rates take effect, around 370 items get cheaper
US President Donald Trump on Friday signed a proclamation raising the fee on the visas used by companies to hire workers, including from India, to live and work in the US.
The H-1B visa fee of USD 100,000 would be applicable only to new applicants, a White House official clarified on Saturday.
Notably, Indian tech professionals account for the bulk of H-1Bs -- over 70 per cent plus.
"IT was the biggest drag, tumbling 3 per cent after the US sharply raised the one-time H-1B visa fee to USD 100,000. This rattled sentiment in a sector that had only recently shown signs of recovery," Siddhartha Khemka, Head of Research - Wealth Management at Motilal Oswal Financial Services Ltd, said.
The domestic market traded on a lower note amid a sharp increase in H-1B visa costs, which weighed on the IT index, Vinod Nair, Head of Research at Geojit Investments Ltd, said.