India's IT sector is undergoing a fundamental transformation as AI agents emerge as the new workforce layer, forcing companies to rethink traditional hiring models. TCS Chairman N Chandrasekaran announced at the company's 31st annual general meeting that TCS will have an equal number of AI agents as employees, stating "the company, and the industry, are unlikely to hire the same number of people because certain portions of the work that is being done will go to AI agents." This represents the clearest signal yet that India's technology industry is preparing for a fundamental shift in how it builds its workforce. The shift is already evident in hiring numbers, with TCS planning to hire 25,000 freshers in FY27, one of the lowest campus hiring figures since 2020. HCLTech and Wipro have not yet disclosed their campus hiring numbers for FY27, reflecting the industry-wide pause in entry-level recruitment.
Market expert Daljeet Kohli has taken an even more cautious stance, advising complete avoidance of the IT sector. As reported by The Economic Times, Kohli states "When a sector goes out of reckoning, it takes a very long time. Equity markets are all about the future, and we are very clear this sector will take very long to stabilise." This represents a significant shift from previous market optimism, with Kohli noting that "the jury is still out" on the sector's recovery prospects. The brutal sell-off has been triggered by weak global cues, Accenture's cautious commentary, and broader anxiety about AI disruption, creating an environment where investors are struggling to identify future winners in the traditionally reliable IT sector.
The transformation is creating new career pathways while eliminating traditional entry-level roles. A report by Cognizant and Pearson found that 37% of entry-level tasks in India are already performed by AI, compared to a 33% global average, with 18% of human resources leaders reporting that AI now handles half or more of entry-level work. Roles such as routine coding, bug fixing, manual testing, basic application support, production monitoring, and simple documentation are declining in demand, while AI application development, agentic AI implementation, Cloud architecture, cybersecurity, data engineering, platform engineering, and AI governance are moving up. Neeti Sharma, CEO of TeamLease Digital, noted that "across industries, the highest-demand profiles today combine three capabilities: domain expertise, AI fluency, and business problem-solving skills."
According to CNBC TV18, Neeraj Seth, Founder and CIO of 3R Investment Management, reports that India's investment environment has improved significantly over recent weeks. The improvement is attributed to falling crude oil prices, policy measures from the Reserve Bank of India (RBI), and a strengthening rupee. Seth noted that the rupee has outperformed several Asian currencies despite broader dollar strength, supported by the decline in oil prices and recent RBI measures. This currency strength is viewed as one of the key ingredients of confidence from a foreign investor perspective.
As reported by CNBC TV18, Seth expects financial stocks to benefit from improving economic conditions, continued credit growth and a potential pickup in corporate capital expenditure later this year. He remains constructive on Indian financials, arguing that banks are supported by healthy credit growth trends, stable asset quality and margin prospects. Seth expects corporate capex activity to gain traction in the latter part of the year, which could further support the sector's performance.
