DeepSeek AI breakthrough to benefit Indian IT stocks, Bernstein says

Investing.com -- Bernstein said Indian IT firms such as Infosys Ltd (NSE: INFY) and Tata Consultancy Services Ltd. (NSE: TCS) stand to benefit as the launch of DeepSeek’s generative AI models lowers inference costs, accelerating enterprise adoption.

The brokerage expects AI projects to move beyond pilot stages, driving large-scale implementation across industries. Unlike semiconductor and hardware firms that benefit in the early stages of AI adoption, IT services companies typically gain in mid-to-late cycles as enterprises build AI-powered applications, Bernstein noted.

“We remain positive on large Indian IT service stocks but also niche SMIDs and expect them to have a seat at the AI table,” analyst at Bernstein said.

Smaller firms like Coforge Limited (NSE: COFO) and Persistent Systems Ltd (NSE: PERS) could also capitalize on the shift as businesses seek skilled partners to integrate AI into operations. The firm said IT services companies will play a crucial role in helping enterprises manage technical debt and customize AI solutions.

Bernstein remains positive on the sector, citing AI-driven growth opportunities through both revenue expansion and efficiency gains.

“We believe the ramifications for DeepSeek Gen AI models are positive for global IT services”

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