The Indian stock markets showed a noticeable impact on Monday due to a decision made by the US government. Shares of numerous IT companies were trading lower. The increase in H-1B visa fees clearly affected Indian IT giants like TCS and Infosys, whose shares sharply declined, resulting in investors losing approximately ₹63,000 crores in just one day.
According to the stock market data, TCS shares fell to ₹3,063.05 during the day and were trading at ₹3,080.80 by 11 am, down 2.87%. Meanwhile, Infosys shares were trading at ₹1500.30, having dropped to as low as ₹1,480.05 during trading. Other IT stocks like Wipro, HCL Tech, LTIMindtree, Tech Mahindra, Persistent Systems, Coforge, and Mphasis also recorded a drop of 2-3%.
Impact of Increased Visa Application Fee
The US administration has increased the H-1B visa application fee to US$ 100,000 (around ₹88 lakh). This change applies to new applications, but current visa holders and renewals will not be affected. The fee, which used to average around ₹6 lakh, is a one-time cost and not an annual expense.
The H-1B visa is a gateway for Indian IT professionals to work in the United States. This decision, effective from Sunday, directly affects Indian IT professionals who dominate this visa category. Analysts believe the impact will be limited initially, with significant effects expected in FY 2026-27.
Moderate Impact on IT Companies
Experts suggest that while the H-1B fee hike will increase costs, it won't drastically affect profit margins. IIFL Securities estimates a minor impact on EBIT margins by 20-60 basis points and a reduction in EPS by 1.2-4.5%.
JM Financial and Nuvama suggest that IT companies can adjust their strategies to manage these costs, such as applying for H-1B visas only for crucial roles, enhancing offshoring, and hiring locally.
In terms of the stock market, experts believe that the H-1B fee hike will affect share prices in the short term, but the Indian IT sector will remain strong in the long term. Investors are advised to focus on company strategies and quarterly results rather than panicking.
