H-1B visa: How TCS, Infosys, Wipro, HCL, TechM shares may react on Monday, September 22

Shares of Tata Consultancy Services (TCS), Wipro, Infosys, HCL Technologies and Tech Mahindra are likely to be in focus on Monday, September 22, after a White House release clarified that the recently announced $100,000 H-1B visa fee will apply only to new applications and not as an annual charge. However, the development is still expected to weigh on IT stocks amid concerns whether IT firms would be in a position to pass on cost fully to clients if they decide to apply for further such visas. 

To be sure, TCS is the second biggest Indian beneficiary of H-1B visas. Infosys, HCL Tech and Wipro too are in top 25, as per the data compiled from US Citizenship and Immigration Services. 

"In the coming week, markets will first react to the US President’s executive order imposing an annual fee of $100,000 on H-1B visas, announced late Friday. While export-driven sectors are already grappling with tariff-related pressures, this move could further weigh on IT services exporters at a sensitive time when trade negotiations remain underway," said Ajit Mishra – SVP, Research, Religare Broking. 

A While House Fact Sheet suggested that the share of IT workers with H-1B visas has risen from 32 per cent in FY 2003 to over 65 per cent in recent years. The Fact Sheet gave examples of IT companies applying for H-1B workers, while laying off US employees.

Without naming anyone, it suggested a company that approved 5,189 H-1B workers in FY2025, while laying off roughly 16,000 US employees. Another company, the Fact Sheet noted, was approved for 1,698 H-1B workers in FY 2025, yet announced it was laying off 2,400 US workers in Oregon in July. A third company has reduced its US workforce by 27,000 since 2022 while receiving 25,075 H-1B approvals. 

TCS' workforce at the end of the June quarter was 613,069. Its employee cost at 47.6 per cent of revenue was nearly at an all-time high. Infosys had total headcount of 3,23,788 in Q1. Its onshore workforce was 23.6 per cent of total employees. 

In his first term also, Trump, through his executive order E.O.13788 “Buy American and Hire American”, increased restrictions on H-1B visas. Denial rates for H-1B/L-1 visas rose substantially, analysts noted. Impact on IT Services players was amplified due to their higher dependence on these visas at the time.

Two-third of IT Services players’ US resources were on H-1B/L-1 visas in FY17. The ratio of visa dependent/local resources has now likely flipped, a JM Financial note in November 2024 suggested. 

This brokerage noted that there was 50-80 per cent drop in H-1B approved visas for Infosys, TCS and Wipro over FY15-24. That insulated players to a large extent from any spike in denial rates.