Nifty IT P/E at 18.7: what changed since March

Four months on

In March this series found Nifty IT at a P/E of 21.08, level with the Nifty 50 after a 22% fall in eight weeks with no change in earnings. Four months later the price is roughly where it was. The ratio is not.

Nifty IT closed at 28,984.40 on Tuesday, 21 July 2026, at a price-to-earnings ratio of 18.68. Its price-to-book ratio was 5.16 and its dividend yield 2.87%. These are NSE's end-of-day figures, charted on the Nifty IT valuation page.

March, the July low, and now

"Earnings" is the index divided by its P/E: the profit behind one unit of the index.

Three things changed.

Earnings rose. The profit behind the index is up about 10.2% since 25 March. It climbed mostly in small daily increments, with one step of 3.1% on 30 June. In March the earnings line had been flat since January; since then it has moved every month.

The price went down and back. From 25 March the index lost 13.1% to its 1 July close of 25,769.80, then recovered 12.5%. It is now 2.3% below its March level. Along the way it moved more than 3% in a day on nine sessions, in both directions, including −5.29% on 24 April, +4.23% on 2 June and −5.57% the next day.

So the ratio fell. Flat price over rising earnings took the P/E down 11.4%, from 21.08 to 18.68. On 1 July it set the lowest reading since NSE moved to consolidated earnings in March 2021: 16.91.

Against its own history

Since 31 March 2021, over 1,308 sessions:

• P/E: median 27.69. Only 17 sessions closed lower than 18.68, all since 14 May 2026.
• P/B: median 8.09. Only 23 sessions closed lower than 5.16, with the low of 4.62 on 1 July.
• Dividend yield: median 2.28%. 260 sessions yielded more than 2.87%.

The year-on-year view is starker. On 21 July 2025 the index stood at 37,031.75 at a P/E of 27.10. Since then the price has fallen 21.7% and the earnings behind it have risen about 13.6%.

For the year so far, Nifty IT is down 23.5%, against 7.4% for the Nifty 50.

Now cheaper than the market

In March, IT's P/E had just dipped below the Nifty 50's for the first time since May 2021. Since 26 March it has been below on 58 sessions, and on 21 July it was 0.90 times the market's (18.68 against 20.65). The widest discount, 0.82 times, came on 1 July.

Since March 2021 the median multiple has been 1.25. On NSE's older standalone basis, IT traded below the Nifty 50 through most of 2015 to 2020, so a discount has a precedent, just not a recent one.

The yield went the other way

The yield fell from 3.88% at the end of May to 2.87% even though the price ended July close to its May level. The dividends behind the index, the price times the yield, dropped in steps: 13.5% on 1 June, 7.8% on 4 June and 6.5% on 6 July, among others. They are down about 26% since the end of May.

The share of profit paid out, yield times P/E, is now about 54%, against about 75% in March. IT companies still pay out a large share; just less of it than the trailing figures showed in spring.

What this does not tell you

Rising trailing earnings say nothing about the next year. The P/E divides by the last twelve months of profit.

The ratio moves as fast as the price. With nine sessions of 3% or more in four months, a P/E reading can change by several points in a week.

The dividend steps may be one-offs or member changes. The published yield cannot say which.

This is the index, not a technology fund. Funds in the theme hold their own mix and weights.

Where to go from here

For every sector against its own median at mid-year, see the cheapest and dearest NSE indices in June, where IT ranked first. Our dividend yield post puts IT's yield beside the market's. The guide on how to read an index P/E ratio covers the measure.