In February 2026, Infosys shares faced a dramatic slide, falling more than 20% over the month, the steepest drop the company has seen in over a decade. This sell-off wiped out huge amounts of value and shook investor confidence. We from the markets team want to unpack what happened, why it matters, and what it means going forward. By the end of February, the stock closed around ₹1,3,0,8, a far cry from its recent highs. The decline has sent shockwaves through India’s IT sector and broader stock market. It is one of the worst monthly falls for Infosys since at least 2013.

 February Market Performance Overview

• Infosys Share Drop: Shares fell ~20% in February 2026. Lost over ₹1.3 lakh crore in market capitalization.
• Nifty IT Index: Fell more than 21% in February worst monthly performance in decades.
• Snapshot of Key Stats
  • Infosys shares: ~20% down in February.
  • Nifty IT index: ~21% drop, worst monthly fall in 20+ years.
  • Mutual funds & FIIs: Large notional losses as selling spread across IT stocks.
• Valuation Impact: Many IT stocks reached multi-month lows. Infosys sometimes marginally outperformed peers amid weak indices.

Reasons Behind the Share Plunge

• AI Disruption Fears: AI tools from companies like Anthropic can automate tasks, threatening labor-intensive IT services. Investor worries about slower growth.
• Heavy Foreign Selling: FIIs sold nearly ₹11,000 crore of Indian IT shares in early February. Added pressure to the drop.
• Mutual Fund Losses: Over ₹50,000 crore worth of mutual fund value tied to IT stocks was erased.
• Global Tech Weakness: IBM in the U.S. suffered one of its worst single-day sell-offs, affecting Indian IT stocks.

Historical Context & Comparisons

• February 2026 Decline: 20% drop worst monthly fall in over a decade.
• Last Major Fall: April 2013 shares fell over 22%.
• Sector Context: Indian IT stocks are usually defensive. Past corrections were followed by consolidation before recovery.
• Current Comparison: February’s sell-off is broad, sentiment-driven, and linked to AI fears, making direct comparisons tricky.

Impact on Investors and the Market

• Investor Portfolios: Many retail investors and mutual funds faced heavy notional losses.
• Sector Rotation: Money shifted from IT to banks, autos, and consumer goods.
• Market Sentiment: Caution among investors due to revenue erosion concerns from AI.
• Benchmark Index Pressure: IT weakness dragged Nifty 50 and Sensex lower on multiple trading sessions.

Outlook

• Long-term Potential: The  Indian IT sector remains strong with diversified services and a solid client base.
• Short-term Volatility: AI disruption concerns and global tech weakness may continue affecting prices.
• Investment Opportunity: Patient investors may benefit if Infosys stock stabilizes in the coming months.

 Conclusion

The sharp drop in Infosys shares this February was more than a short-term blip. It reflected deeper concerns about how technology and automation could reshape one of India’s most important export sectors. The fall has tested investor patience, erased large sums of market value, and caused many to rethink long-held assumptions about IT stocks.Yet, when markets shift fast, opportunities often appear for patient investors. Whether this correction signals a new structural phase or just a cyclical trough remains uncertain. What’s clear is that investors will watch Infosys and the broader IT sector closely as both adapt to a rapidly changing tech landscape.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.