Summary of this article
US suspends PERM scheme for major Indian IT companies.
TCS, Infosys, and Wipro shares gain despite the announcement.
Suspension forces costly local hiring, threatening IT operating margins.
Stocks of IT majors such as Tata Consultancy Services (TCS), Infosys, Wipro, and HCL Technologies are in focus on October 9, 2026. The stocks are in focus as the US government has announced its decision to suspend the Program Electronic Review Management (PERM) scheme for eight IT firms, Tata Consultancy Services (TCS), Infosys, Wipro, HCL Technologies, Microsoft, Adobe, Cognizant and Capgemini.
The announcement of the suspension was made on October 8, after the closing bell, thus D-street is set to factor in the regulatory and financial implications of the suspension on the US operations of these Indian IT firms.
IT Stocks Gain Despite Pressure
Shares of Tata Consultancy Services gained by 4.72 per cent to an early high of Rs 2174 apiece on the NSE. Shares of Infosys gained by 2.97 per cent to an early high of Rs 1026.7 apiece on the NSE. Shares of Wipro rose by 2.97 per cent to an early high of Rs 163.09 apiece on the NSE. Shares of HCL Technologies also gained 3.07 per cent to trade at Rs 1213.1 apiece on the NSE. All 10 constituents of the Nifty IT index traded in the green in early trade as the index rose 3.12 per cent to trade at 28604.75.
What Is The PERM Scheme
The PERM scheme is a certification process administered by the US Department of Labor and acts as a first step for US employers who wish to sponsor foreign workers for employment based permanent residency, also known as green cards. The process requires employers to prove that there are no qualified, willing, and available American workers for the specific position being offered to the foreign employee.
How Can PERM Suspension Impact IT Companies
The PERM suspension blocks Indian IT firms from filing new PERM applications and halts the processing of all their pending applications. Indian IT companies rely on the H1B visa program and the subsequent green card sponsorship process to deploy and retain talent in the United States.
Without the ability to sponsor permanent residency, these companies are expected to face a hurdle in keeping experienced engineers and project managers at long term client sites. Foreign employees nearing the end of their temporary visa limits may be forced to leave the country. To fill these gaps and maintain project continuity, companies will have to increase their local hiring in the USA, which can significantly drive up wage costs and can potentially squeeze operating margins.
Notably the North American market accounts for bulk of revenue for TCS, Infosys, Wipro, and HCL Technologies. When bottlenecks occur in a large geographical market client relationships are tested. Additionally, the higher wage costs associated with mandatory local hiring can directly erode profitability. D-street is expected to factor in these upcoming margin pressures, potential revenue disruptions, and broader regulatory risks in today’s trade.
However, in today's trade Indian IT stocks gained as robust earnings momentum and strategic resilience overshadowed regulatory concerns. Notably Tata Consultancy Services (TCS) reported a strong 14 per cent year-on-year rise in Q2 FY27 net profit to Rs 13,934 crore, alongside an interim dividend of Rs 12 per share.
Investor sentiment around the US Department of Labor's PERM processing pause was also insulated by reassurance from TCS clarifying that the freeze will not disrupt the company's workforce plans given its aggressive push into local US hiring, including plans for 15,000 onshore workers. This in turn demonstrates how Indian tech majors are diversifying and de-risking their operational delivery models from visa dependencies.
“We have noted the announcement by the US Government on the Permanent Labor Certification Program (PERM) and TCS will comply with any directive from the Department of Labor. As we had announced earlier, we intend to hire an additional 15,000 people in the US over the nextfive years, to further augment our local workforce. Our PERM applications were in single digits in the last two years and hence we do not expect the suspension of the program to impact our workforce strategy and customer engagements,” TCS said in a filing.
At the time of writing, TCS shares traded around Rs 2,086.00 apiece, up by 4.24 per cent on the NSE. Shares of Infosys traded around Rs 1,007.30 apiece, up by 2.41 per cent. Wipro and HCL Technologies shares traded lower by 3.33 per cent and 2.22 per cent respectively at the time of writing.
