Persistent, Coforge, Mphasis: Analyst shares midcap picks amid IT rally

Indian equities may have staged a smart rebound, but the durability of the move remains under scrutiny as the recovery appears heavily dependent on the IT pack. Market expert Vishnukant Upadhyay said the latest leg of gains has been largely driven by technology stocks, particularly after HCLTech’s better-than-expected earnings, even as the broader market setup still looks uncertain.

"The gains in the Indian market have been driven by the IT stock," Upadhyay said, pointing to sharp moves in HCLTech and TCS. He added that it may still be "a little premature" to call this the start of a sustainable sector-wide rally, but sees more near-term room on the upside.

IT pack takes the lead

The sharp rally in frontline technology names has turned the sector into the market’s clear leadership pocket. Upadhyay expects a further 3-4% move in the IT basket from current levels, with large-caps such as TCS, HCL Tech and Infosys likely to remain in focus.

He is also constructive on midcap IT names including Persistent, Coforge and Mphasis, suggesting the momentum is not limited to just one or two earnings-driven trades. That matters for sentiment, especially at a time when investors have been weighing global concerns around an AI-linked tech selloff.

Why the market mood is still cautious

Even with IT lending support, Upadhyay described the broader market as "little dicey," signaling that traders should avoid reading too much into a one-day or one-week rebound. For expiry-focused traders, he said there is no clearly constructive setup yet.

His near-term range for the market stands at 22,300 on the downside and 22,650 on the upside, implying that stock-specific action may continue to dominate until a stronger directional trigger emerges. In other words, the rally has improved tone, but not yet conviction.

The technical trigger to watch

A key reason for the cautious optimism is the weekly chart pattern. Upadhyay noted that the market formed a doji candlestick last week, often interpreted as a sign that the ongoing decline may be pausing or that a reversal attempt could be building.

Still, he drew a clear line in the sand: a bullish reversal would require the index to trade sustainably above the 22,850-22,900 zone. Until that happens, his stance remains tactical rather than aggressive. "As long as prices are below that level, there will be a sell-the-rally, buy-the-dip-from-lower-levels kind of market," he said.

For now, IT may be carrying the market, but the next phase will depend on whether the index can convert a rebound into a confirmed breakout.