New Delhi, February 14: In a reassuring report for India’s booming IT sector, JP Morgan’s Asia Pacific Equity Research team has dismissed fears that artificial intelligence (AI) will wipe out IT service companies anytime soon. Instead, the global financial giant predicts AI will supercharge productivity, allowing firms to handle more projects without ballooning budgets.
The report cuts through the hype surrounding AI’s disruptive potential. ‘The notion that AI will eliminate IT companies is greatly exaggerated,’ it states bluntly. Drawing parallels with past tech shifts like offshoring, enterprise software, and cloud computing, JP Morgan argues these innovations didn’t destroy IT services but transformed how companies operate.
AI, the analysts say, will follow suit. It promises to enable enterprises to modernize legacy systems, rewrite SaaS applications on demand, build AI agents for operations, ensure trust in AI systems, and integrate physical AI solutions—all areas demanding robust IT support.
Enterprise tech teams often grapple with limited budgets compared to lofty business expectations. Here, AI steps in not as a replacement but as a productivity booster for IT firms. The brokerage warns against assuming AI can autonomously churn out enterprise-grade software or handle complex integrations that IT ‘plumbers’ expertly manage in large organizations.
Recent weakness in IT stocks reflects investor jitters over AI’s rapid advances potentially slowing revenue growth and shrinking the total addressable market for Indian IT giants. But JP Morgan’s analysis paints a brighter picture: AI isn’t a threat—it’s an opportunity generator.