Smit Mehta

Investor

[Smit Mehta @smitmehta97]

@arabicatrader 🤣🤣🤣🤣

[Smit Mehta @smitmehta97]

All Eyes on Delhi. Something big is cooking !!

#politics

[Smit Mehta @smitmehta97]

NSE has filled its DRHP - it's 100% OFS of 148,905,525 shares

Biggest IPO of 2026!

#NSE #BSE

[Smit Mehta @smitmehta97]

@niftybuddy Bse, na haath mein aata hai, and jab short karne jaao to premium decay hota hai!!😝😂

[Vikas Vij @TheClubJunto]

IT Sector's Sunset Is Near

1. TCS: 92% FCF as dividends; zero risk; old bureaucracy continues

2. Strategic Sector: 10% of GDP; 30% of Exports; 6M Workforce

3. Biggest Hangover for FIIs & INR: No AI pivot

4. Vishal Sikka: In next 3-4 Qtrs disruption begins in Indian IT

FACTS:

The IT Valuation Trap

a. AI Compression: On 24 Mar, JP Morgan warned that Indian IT sector is caught in a “valuation trap.” Instead of being a beneficiary of AI, Indian firms are facing the opposite: AI margin compression.

To offer a cheaper cost than the client’s in-house AI team, it can become a race to the bottom (your manpower model vs. their AI models).

b. Dollar Revenues: FIIs look at dollar revenues as the most important metric. If dollar revenue declines, it means clients are buying less (even if you earn more due to rupee depreciation).

c. TCS FY26 Dollar Revenue: (-) 0.5% YoY. First-ever decline in TCS history. For context, Accenture grew +8% in the same period.

d. TCS Valuation Risk: TCS P/E ratio is higher than Accenture because TCS operating margins are much higher (25% in Q4) compared to Accenture’s 15-16%.

That’s because TCS pays its employees even less than a bus conductor. Now that entire model is at risk because clients don’t want manpower-led billing.

e. Indian IT founders want to die rich, so they will not innovate. Innovation is risky. They won’t make aggressive acquisitions or even split their company. (AI subsidiary can be a non-legacy product business to compete globally.)

f. Capital Allocation: In TCS, every leader, including the Board of Directors, is an employee who works for a pay raise, bonus, and a nice retirement. They are not agents of change.

So, they did not change the business model. TCS returned 92.1% of Free Cash Flow (₹39,571 cr out of ₹42,983 cr) in FY26 as dividend.

India’s Most Strategic Sector Is at Risk

a. IT industry’s share in India’s GDP has risen to over 9% in FY26 ($315 billion).

b. Net Forex Earner: IT sector constitutes 30% of India’s exports, making it a critical source of foreign exchange and rupee stability.

c. Direct employment in IT industry is 6 million. Many more industries and workers are indirectly supported by this skilled, white collar workforce.

Vishal Sikka’s Warning

Vishal Sikka is the guy who wanted India to pivot to AI a decade ago. But India was not ready to seize global leadership. Now he is warning the IT sector once again. Excerpts from his interview of March 27, 2026:

a. IT stocks are getting thrashed because the market believes Indian IT companies will not be able to change in time. Market has a wisdom of its own, but who knows. Time will tell.

b. In any case, one thing is clear. If Indian IT companies don’t adapt to AI, and don’t make this change, then they will not make it. That is for sure.

c. You will start to see that happen in the form of decline in margins, to begin with. And over time, it will be followed by decline in revenues.

d. If you continue to renew the existing contracts on existing terms (manpower-led billable hours), then some of those customers will simply not renew.

e. Some of those customers will ask for new terms, which are going to be very difficult to match for Indian IT firms, unless you are able to bring AI into your business model.

f. So, the question is: what percentage of the existing contracts is going to get disrupted this way? I think in the next 2/3/4 quarters, we will start to examples of that.

g. On the contrary, if you start to see Indian IT companies demonstrating thousands of new efforts around new kinds of transformational work using AI, then there is no threat, but a massive growth opportunity.

h. I don’t know how the market is seeing this, but very soon it will be clear whether Indian IT’s transition to AI is happening or not.

i. What should Indian IT companies do to stay relevant? Build own AI platforms, own AI intellectual property (IPs), and double down on AI integration into services.

j. What piece of puzzle can Indian IT companies start off with? Skill as many people as possible in using AI agentic work. Offer services using AI-driven business models (outcome-based models; not billable hours-based).

k. And build all of this as fast as possible, assuming there is no tomorrow.

ENDPIECE: Hungry vs. Over-satisfied

When a developing country is dominated by mature, zero-growth dinosaurs with a resistance to risk and innovation, it will drift into irrelevance in a competitive world.

@arabicatrader

[Smit Mehta @smitmehta97]

@SuperDhaasu TCS ke result ko dekh ke yahi lag raha hai!!

[Smit Mehta @smitmehta97]

@SuperDhaasu Pata hau Supardhaasu ji😂 par FII back to nahi hue. 24500 ke upar dekhenge tik gaya toh.

[Smit Mehta @smitmehta97]

@ankitatIIMA I can see people talking about Buying now as we are at bottom, but just because of your Knowledge I understood that I can still wait and today Mr. Warren buffet also sign the same. March dip is nothing!!! Thank you @ankitatIIMA

[Smit Mehta @smitmehta97]

@ankitatIIMA Sir as you said US will leave NATO. Now Trump just said that they are leaving. Thats what we need 😌!!!

[Smit Mehta @smitmehta97]

@ankitatIIMA As you mentioned Dates Ready hai!! Waiting for this!!🤣🤣🚀🚀🚀🚀

[Smit Mehta @smitmehta97]

@niftybuddy Bang on Analysis again, before TV wale. Last time late tha but this time I'm with you, bought sweet Options of index and few stocks aaj ke bottom se. Bas aap Class start karo apni, lot of things to learn from you. Not daily but weekly or biweekly once. Again Thanks and God Bless!

[Smit Mehta @smitmehta97]

@SuperDhaasu Abhi Starting hai I feel, lamba niche jaayega ye toh!!

[Smit Mehta @smitmehta97]

@niftybuddy Perfect rejection from this trendline resistance.

[Smit Mehta @smitmehta97]

@niftybuddy I think you waiting for this channel breakout bcz I'm also waiting, which nearly above 23650-23700.

[Smit Mehta @smitmehta97]

@ankitatIIMA Trump asked the world to join a multinational naval coalition to keep the Strait of Hormuz open.
🇮🇹 Italy: Rejected
🇪🇸 Spain: Rejected
🇯🇵 Japan: Rejected
🇳🇴 Norway: Rejected
🇨🇳 China: No response
🇬🇧 UK: No commitment
🇰🇷 South Korea: No confirmation
America looks Helpless

[Smit Mehta @smitmehta97]

@niftybuddy Sir aaj Aap Gayab mode mein ho Esa lag raha hai !!

[Smit Mehta @smitmehta97]

@niftybuddy Boss Dow too, Bearish Marubuzu below 200 EMA Support. Aaj Friday hai. Om Foo hoga!!

[Smit Mehta @smitmehta97]

@factopedia0 @niftybuddy @cryptbitgeek Channel ko break kiya hai, bahot jald number lagega 🤞🏻

[Smit Mehta @smitmehta97]

@niftybuddy @cryptbitgeek Aree Guru🙏🏻 Crazzy. Aap mentorship shuru karo. I'm in. The way of View of stocks and sector is very different of yours.