IT selloff a 'knee-jerk' reaction, says Ambareesh Baliga; shares top 3 stock picks
Speaking to Business Today, the market expert said, "I think it was a knee-jerk sort of a reaction, and this fear is clearly linked to that specific sector. I think that the correction can overstretch, but then what I see is, in times of disruption, the survival instinct comes into play."
- Feb 17, 2026,
- Updated Feb 17, 2026 10:55 AM IST
Market expert Ambareesh Baliga believes the recent selloff in information technology (IT) stocks was largely a "knee-jerk reaction" driven by sector-specific fears.
Speaking to Business Today on Tuesday, Baliga said, "I think it was a knee-jerk sort of a reaction, and this fear is clearly linked to that specific sector. I think that the correction can overstretch, but then what I see is, in times of disruption, the survival instinct comes into play. I see most companies reinventing themselves, and IT workers will clearly have to reskill so that they're not left out. And, even in the past year, we have seen similar fears. I mean, if you go back to Y2K, large teams finally moved from simple fixes to full software development and long-term client work. We have also seen software as a service and cloud platforms when they were introduced. Again, people expected the IT services demand to fall, but then the IT companies migrated into cloud system integration. So, clearly, we have seen revenues increasing for IT companies, employment increasing."
He also said, "I'm not really worried. We only need to see those IT companies which are fleet-footed and are able to change decently fast. Because, if you go back to the '90s, I mean, computerisation itself was a threat. But just see the sort of employment which, which, which it has generated. In the next few years, you will see leaner and more effective IT firms, and productivity will improve substantially. So, as I said, you just need to watch out for the ones which are more fleet-footed."
Sharing his views on stock ideas with potential upside, Baliga said, "One will be the largest infrastructure company in India, Larsen & Toubro (L&T). The earnings were better than expected. And, the execution which they are doing, I think over the next two to three years, we should see still much better earnings from L&T."
He added, "The other sector, which I would still look at as earnings of some of them surprised in the positive and now with the US-India trade treaty, should help further is the speciality chemicals. That's one sector to be looked at. Stocks like Deepak Nitrite Ltd could be bought even at the current levels. The other one would be Archean Chemical Industries Ltd."
Market expert Ambareesh Baliga believes the recent selloff in information technology (IT) stocks was largely a "knee-jerk reaction" driven by sector-specific fears.
Speaking to Business Today on Tuesday, Baliga said, "I think it was a knee-jerk sort of a reaction, and this fear is clearly linked to that specific sector. I think that the correction can overstretch, but then what I see is, in times of disruption, the survival instinct comes into play. I see most companies reinventing themselves, and IT workers will clearly have to reskill so that they're not left out. And, even in the past year, we have seen similar fears. I mean, if you go back to Y2K, large teams finally moved from simple fixes to full software development and long-term client work. We have also seen software as a service and cloud platforms when they were introduced. Again, people expected the IT services demand to fall, but then the IT companies migrated into cloud system integration. So, clearly, we have seen revenues increasing for IT companies, employment increasing."
He also said, "I'm not really worried. We only need to see those IT companies which are fleet-footed and are able to change decently fast. Because, if you go back to the '90s, I mean, computerisation itself was a threat. But just see the sort of employment which, which, which it has generated. In the next few years, you will see leaner and more effective IT firms, and productivity will improve substantially. So, as I said, you just need to watch out for the ones which are more fleet-footed."
Sharing his views on stock ideas with potential upside, Baliga said, "One will be the largest infrastructure company in India, Larsen & Toubro (L&T). The earnings were better than expected. And, the execution which they are doing, I think over the next two to three years, we should see still much better earnings from L&T."
He added, "The other sector, which I would still look at as earnings of some of them surprised in the positive and now with the US-India trade treaty, should help further is the speciality chemicals. That's one sector to be looked at. Stocks like Deepak Nitrite Ltd could be bought even at the current levels. The other one would be Archean Chemical Industries Ltd."