Indian IT stocks trading as American Depositary Receipts (ADRs) were under significant pressure in US markets on Thursday, with Infosys ADRs falling 3.13% to $10.14 and Wipro ADRs declining 2.4% to $1.63 following the Trump administration's suspension of several technology companies from the Permanent Labour Certification programme. According to ET Now, Infosys ADRs opened slightly lower at $10.54 compared to its previous close of $10.55, while Wipro ADRs also declined 2.4% to $1.63. The GIFT Nifty was trading 28.50 points, or 0.13%, lower at 20:54 IST on Thursday, while the S&P 500 was down 0.2% and heading for its second straight decline after hitting a record high. Infosys' market value stands at around $41.62 billion, with the stock falling 39.68% so far this year.
The US Department of Labour suspended major IT firms including Infosys, Tata Consultancy Services (TCS), Wipro, HCL Technologies, Cognizant and Capgemini from the Permanent Labour Certification programme. As reported by Live Mint, US Labour Secretary Keith Sonderling announced the action, stating 'I am hereby suspending from the Permanent Labour Certification Programme some of the largest IT outsourcing firms in the world, Cognizant, Infosys, Tata, Wipro, HCL, and Capgemini.' The US Department of Labour also suspended Microsoft and Adobe amid multiple federal investigations. According to the latest reports, since 2009, just these companies alone have requested almost three million foreign workers. Sonderling revealed that they've received over 230,000 H-1B visa approvals and over 100,000 permanent labour certifications, stating 'That's hundreds of thousands of jobs that were taken from American workers.' The suspension blocks companies from filing new PERM applications and puts pending applications on hold for as long as the suspension remains in effect.
Industry body **Nasscom on Thursday said that immigration and skilled talent mobility are 'two distinct issues' that should not be viewed through the same lens, after the US suspended eight tech firms, including Tata, Infosys, HCL and Wipro, from a key green card programme. In a statement, Nasscom said 'The US Department of Labour has today announced the temporary suspension of certain IT companies, including Indian technology companies operating in the US, from filing new applications under the Permanent Labour Certification (PERM) programme.' The industry body emphasised that 'the H-1B visa programme has historically played an important role in addressing short-term skill gaps in the US and will continue to be used to address short-term talent gaps.' According to PTI, Indian professionals account for more than 70 per cent of all approved H-1B petitions annually, highlighting the significant role of Indian IT professionals in the US workforce.
Secretary Keith Sonderling announced the suspension of what he described as 'some of the largest IT outsourcing firms in the world' from the Permanent Labour Certificate (Perm) process. According to Reuters, Vice President J.D. Vance stated 'Our message to Microsoft is: You're a great American company, but you've got to hire great American workers.' He accused Microsoft of laying off 6,000 American workers while simultaneously applying for thousands of H-1B visas and PERM applications. Under the Permanent Labour Certificate process, employers seek certification from the Department of Labour that there is no qualified, willing or available US worker for a specific job, which is a step required before filing petitions for most employment-based green cards. H-1B visas are designed for highly skilled positions that employers may struggle to fill with qualified US workers, with nearly three-quarters of approved visas going to workers from India according to The Associated Press.
The regulatory action extends beyond IT companies to include major educational institutions. Vice President J.D. Vance announced that nine universities, including Harvard, Yale and Stanford, would be investigated for allegedly bringing in international students to undercut American wages. According to Live Mint, Labour Inspector General Anthony D'Esposito confirmed that subpoenas had already been served to these institutions. D'Esposito stated that 'We will investigate whether foreign influence, improper financial relationships, or visa abuse are compromising federally funded research.' This expansion represents a broader effort to address alleged fraud in the immigration system across multiple sectors.
The market pressure came as investors assessed Tata Consultancy Services' September-quarter earnings, which showed continued growth in AI-related business despite margin pressures. As reported by The Financial Express, TCS reported a 15% year-on-year rise in consolidated net profit to ₹13,884 crore for the September quarter, with revenue from operations increasing 11.2% to ₹73,188 crore. The company declared an operating margin of 24% and annualised AI revenue of $3.1 billion, which crossed 10% of its overall revenue. TCS's annualised AI revenue rose to $3.1 billion in the September quarter from $2.6 billion in the previous quarter, with analysts having expected revenue of ₹731.48 billion according to LSEG data. The company also reported total contract value of $9.6 billion and workforce increased to 598,056 employees, while declaring a second interim dividend of ₹12 per share. Infosys has earlier cut its revenue growth forecast for the full financial year, now expecting revenue to grow 1.5% to 3% in constant currency terms after adjusting for mergers and acquisitions.
