Infosys Ltd, India’s second-largest IT services and consulting company, saw its shares drop by nearly 11%, its biggest intraday percentage drop since October 2019, after releasing a revenue outlook below the market’s expectations. The entire IT sector was affected by this drop, with all ten major constituents of the Nifty IT index falling sharply.

On Thursday, the Bengaluru-based company reported its Q4 results. The IT giant’s Q4 net profit came in at Rs 6,128 crores, up nearly 8% QoQ. While revenue also rose by 16% QoQ to Rs 37,441 crore. However, the company reported weaker-than-expected growth, leading the share price to fall.

Infosys’ outlook followed a disappointing quarterly report from its larger rival, Tata Consultancy Services (TCS). This is because both firms saw a decline in overseas demand in the wake of a global slowdown and fears of a possible recession in the US. Infosys’ weaker financial growth forecast for this fiscal year at 4-7% would be the slowest in six years.

The dismal revenue outlook of the sector, which earns more than 25% of its revenue from just the US and European banking and financial services sectors, highlighted the impact of banking turmoil in the major markets.

Infosys’ revenue decline and weaker financial growth forecast caused several brokerages to be cautious about the stock’s future performance outlook, with most trimming their target price.

Infosys shares reached their lowest level in over two years, but a bounce-back is expected as the stock is highly oversold, with the RSI showing a reading of 22.8, the lowest since April 2022. The current downside momentum is the strongest over a year, making this counter highly oversold.

Shares of Infosys Ltd traded at Rs 1,236.80, down by Rs 152.40 or 10.97% from the previous close on Thursday. This is the lowest the shares have reached in two years.