TCS, Infosys, Tech Mahindra and many other stocks from technology sector witnessed strong buying in today's session. Indian markets closed positive on Monday with NSE Nifty gaining 183 points. Banking sector stocks also witnessed strong buying during today's session. Indian markets are currently looking positive as NSE Nifty has closed above 25,000 levels. Max Healthcare was among top gainers among NSE Nifty 50 stocks. TopNews Team has reviewed technical levels for buzzing stocks for short term traders. Gold prices were trading at all-time highs in international markets with one ounce of Gold currently trading near $3,950.

TCS: Resilience Amid Margin Pressure

Tata Consultancy Services (TCS) remains the bellwether of India’s IT story, even as the company faces a complex mix of profitability pressures and strategic recalibration.

The company’s Q2 FY25 results, announced on October 10, 2024, reflected steady topline performance. Consolidated revenue from operations reached ₹64,259 crore, marking a 7% annual growth and 5.5% climb in constant currency terms. The figures were largely aligned with consensus estimates, driven by strong traction in Energy, Utilities, and Manufacturing verticals, and robust growth across emerging markets such as India, the Middle East, Africa, and Asia Pacific.

Still, attention quickly turned to earnings quality. Net profit rose 5% YoY to ₹11,909 crore, missing projections and dipping quarter-on-quarter. Margins narrowed to 24.1%, slipping 20 basis points year-on-year. This modest contraction, while not alarming, underscored persistent challenges in balancing wage inflation, cost investments, and pricing friction across client segments.

Following the earnings announcement, TCS’s share price initially rose but quickly reversed course, closing down 0.59% at ₹4,227.9 and tumbling nearly 3% the next day. Over the past month, the stock has lost 6.26%, reflecting both investor caution and sector-wide fatigue.

Analyst Reaction and Valuation Debate

Brokerage opinions were notably divided, capturing both skepticism and guarded optimism:

Citi and Investec reiterated “Sell” calls, citing client-specific slowdowns and muted near-term demand.

Nuvama Wealth Management trimmed its EPS estimates, citing softer deal conversions.

Motilal Oswal (MOFSL) noted that automation and pyramid efficiencies would help, but highlighted pricing strain, the transition to Generative AI, and wage investments as near-term margin drags.

Still, analysts highlighted new growth triggers. A $640 million contract with Tryg Insurance reinforced TCS’s ability to secure high-value, long-dated mandates. In parallel, incremental improvements in discretionary spending within BFSI and technology verticals emerged as key positives.

However, risks remain pronounced. The so-called “Trump tariffs” targeting Indian IT exports, plus rising U.S. visa and compliance costs, directly threaten margins for firms like TCS—the second-largest global user of H-1B visas. With client decision cycles lengthening and deal ramp-ups delayed, visibility remains foggy.

Yet long-term investors are growing more interested after a 30% correction in TCS shares over the past year. Supported by an industry-leading 52% return on net worth, the stock offers resilience. For patient investors, the current price levels may signal value amid volatility.

Tech Mahindra: Struggling to Find Momentum

Among large-cap IT peers, Tech Mahindra has endured greater turbulence in 2025, largely reflecting its higher exposure to discretionary digital spending and U.S.-centric projects.

As of October 6, 2025, the stock traded at ₹1,436.30, up 2.55% for the day, but nursing a 12.68% annual loss. Over the last month, it declined 7%, with only a faint lift from a short-lived tech rebound ahead of second-quarter earnings.

Most analysts remain cautious. ICICI Securities retained a “Hold” rating with a target of ₹1,250, suggesting limited upside until margin recovery becomes visible. Motilal Oswal, in contrast, applied a “Reduce” stance but with an aspirational target of ₹1,850, acknowledging selective tailwinds in enterprise communications and networks.

The sector’s broader pressure points—U.S. tech budget cuts, steep H-1B compliance costs, and tight project budgets—continue to weigh on profitability. Some investors initially viewed visa-related costs as a potential “margin boon,” expecting cost recovery mechanisms. However, higher regulatory costs and elongated deal cycles have proven otherwise.

On valuation metrics, Tech Mahindra trades at a PE ratio of 30.2 and a price-to-book of 4.46, implying fair valuation but limited headroom for re-rating. With a 52-week range between ₹1,209.40 and ₹1,807.70, the stock sits near the lower end—symbolizing both risk and opportunity.

Sector watchers point to optimism surrounding potential U.S. Fed rate cuts later in 2025, which could reflate export demand. Until then, the company’s outlook remains restrained, with profitability constrained by wage inflation and compliance cost growth.

For now, Tech Mahindra epitomizes a sector stuck in consolidation—awaiting a macro or sentiment trigger for meaningful re-rating.

Max Healthcare: A Policy Windfall Redefines the Sector

In a sharp contrast to IT’s caution, Max Healthcare has emerged as a standout beneficiary of transformative regulatory action. The Indian government’s decision to revise medical procedure rates under the Central Government Health Scheme (CGHS) has unlocked a long-awaited tailwind for hospital operators.

On October 6, 2025, the Ministry of Health announced an upward rate revision across nearly 2,000 medical procedures—the first such update in over ten years. In critical specialties such as cardiology, oncology, neurology, and orthopedics, revised rates range from 5% to 30% higher, effective October 13.

The change will directly impact approximately 4.26 million beneficiaries, encompassing central government employees and retirees. For hospitals like Max Healthcare, this means better cost recovery, improved profitability on public reimbursements, and a structural boost to volumes.

Market and Analyst Reactions

The market wasted no time in recognizing the impact. Max Healthcare’s stock surged 4.3% intraday on October 6, emerging as the top gainer on the Nifty Healthcare index, which itself advanced 0.6% amid sector-wide rallying. Peers Apollo Hospitals and Fortis Healthcare also joined the upward momentum.

According to Macquarie Research, the revision is “meaningful” and could lift EBITDA for Max Healthcare and Apollo Hospitals by mid-single-digit percentages, particularly as procedure volumes expand in the high teens. Analysts across the board raised earnings forecasts and cited improved visibility for FY26 and beyond.

A critical factor amplifying Max Healthcare’s gains is its recent inclusion in the Nifty 50 index, attracting incremental fund inflows from passive investors. The company is now better equipped to capitalize on expanding margins and stronger operating cash flows.

Broader Industry Context

The CGHS revision came as a long-awaited relief after years of lobbying by healthcare operators. The new rate structure will allow hospitals to better offset escalations in staff costs and inflation-linked input pressures. Moreover, it signals a more collaborative approach between government and private medical entities—a model that could favor long-term healthcare investments.

Under new rules, hospitals must sign refreshed Memoranda of Agreement (MoA) within 90 days of the policy’s effective date, marking a complete reset in CGHS engagement terms.

As a result, FY26 is poised to be a breakout year for the hospital sector, with government-linked business potentially shifting from loss-making to profitable. Max Healthcare, leveraging scale and network reach, is strategically positioned to lead this transformation.

Comparative Analyst Snapshot (October 2025)

Short Term View Remains Positive

For investors scanning India’s cyclical vs structural opportunity matrix, the divergence between IT and healthcare could not be clearer.

TCS offers durable fundamentals, scale, and potential AI-led margin tailwinds, but faces temporary valuation correction risks amid global IT weakness.

Tech Mahindra sits in a waiting zone—its longer-term digital transformation portfolio remains relevant but needs macro revival to reignite growth.

Max Healthcare, by contrast, stands at the forefront of a regulatory inflection, commanding attention from institutional investors eager for growth anchored in domestic consumption and policy reform.