How Wipro's Nifty exit shows old warhorse Indian IT is losing charm

Wipro is all set to be replaced by stock exchange BSE on the benchmark index Nifty 50, with analysts pointing out that the tech major’s exit reflects the rising investor concerns around IT stocks.

The National Stock Exchange (NSE) announced changes to its indices on Monday, with the rejig set to take effect from September 30. According to Nuvama Institutional Equities, Wipro could see outflows of around $240 million following its exit from the benchmark Nifty 50 index.

IT stocks have seen sharp swings this year so far. As the artificial intelligence frenzy took hold, IT stocks initially plunged as concerns grew over the nascent technology disrupting India’s much-touted IT sector. However, analysts later raised concerns over massive AI spending by global hyperscalers, triggering a sharp rebound in Indian IT stocks.


Wipro shares have gained 5% in a month, but are down 31% in 2026 so far and 24% in a year, delivering negative returns of more than 11% over three years and 39% over five years. The combined weight of India’s top five IT companies in Nifty 50 has fallen below 9% this year, the lowest at least since 2002, according to data compiled by Bloomberg. Notably, Bloomberg reported that the group accounted for more than one-fifth of the benchmark at its peak about two decades ago. It now trails financials, which have around 36% weight in the gauge, as well as consumer discretionary and energy.

“The symbolism is difficult to miss,” the report quoted Ponmudi R, chief executive of brokerage Enrich Money, as saying. “One of the companies that defined India’s outsourcing boom is being replaced by a business benefiting from the financialization of Indian household savings,” he added.

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The Nifty IT index plunged 32% from the beginning of 2026 to hit a 52-week low of 25,699 on July 1. The sectoral index has now recovered around 24% since then to trade at around 31,775 on Tuesday. It is still 16% down overall this year so far.

Why is BSE replacing Wipro on the Nifty 50 index?

NSE noted that BSE has been included in Nifty 50 index as the six-month average free-float market capitalisation of the company within eligible universe is at least 1.5 times that of the smallest constituent, which is Wipro (Rs 55,930 crore).

TVS Motor Company and Divi’s Laboratories were the other two eligible names not considered for inclusion in the Nifty 50 index as the average free-float market capitalisation of the two Nifty 50 constituents with lowest average free-float market capitalisation (after Wipro) namely HDFC Life Insurance Company (Rs. 65,666 crores) and Tata Consumer Products (Rs. 73,054 crores), was less than 1.5 times the six-month average free-float market capitalisation, NSE added.

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(With inputs from agencies)

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