Motilal Oswal note on Tech ‘Time to buy the next cycle

MOTILALOFS

1⃣ AI infra build-out is nearing saturation, setting the stage for a services-led upcycle 2⃣ IT’s weight in Nifty is at a decadal low (10% vs 19% peak in Dec’21), but profit share steady at 15%. 3⃣ As AI deployment scales from 2HFY27, growth and valuations look primed to rebound 4️⃣ Upgrade Call on IT Stocks 👍 Upgrade Infosys, Mphasis, and Zensar to BUY and Wipro to Neutral 👍 Roll over target prices to FY28E EPS & upgrade the target multiples by ~20%