Information Technology – Thematic Report – AI Led repositioning underway for next demand cycle
Published on 20 Apr 2026
The NIFTY IT index has corrected ~25% since the start of the calendar year, despite no material deterioration in IT companies’ fundamentals. The correction is driven by market fears around AI disruption. Globally, enterprise AI adoption remains in the early stages. As per ISG, only ~30% of AI use cases reach the implementation stage. A large part of trials is excessively reliant upon probabilistic outcome, leading to rise in the “AI Death Valley,” as the underlying data architecture and fragmented process still don’t meet enterprise expectations. In this scenario, the role of integration partners becomes even more relevant for bridging the contextual gap between LLM providers and enterprise clients. Further, we expect AI adoption to act as a net positive for technology spending over the medium term, despite the near-term headwind, driven by both greenfield investments (AI and agentic AI-led initiatives) and brownfield programs (data modernization and legacy technology transformation).
