HCL Technologies Falls 8.70%: 5 Key Factors Behind the Sharp Weekly Decline

9 February 2026: Modest Start Amid Positive Market

HCL Technologies began the week on a relatively positive note, closing at Rs.1,602.05, up 0.53% from the previous Friday’s close of Rs.1,593.55. This gain, however, was modest compared to the Sensex’s 1.04% rise to 37,113.23. Trading volume was low at 30,438 shares, indicating limited investor enthusiasm despite the broader market rally. The stock’s price remained below its 52-week high of Rs.1,770, suggesting cautious optimism.

10 February 2026: Downgrade to Hold and Technical Momentum Shift

On 10 February, HCL Technologies was downgraded from a Buy to a Hold rating by MarketsMOJO, citing elevated valuation concerns and a shift in technical momentum. The stock closed sharply lower at Rs.1,572.30, down 1.86%, despite the Sensex gaining 0.25%. The downgrade reflected a premium valuation with a PE ratio of 25.3, higher than peers such as TCS and Infosys, and a technical trend moving from mildly bullish to sideways. The trading volume surged to 408,897 shares, signalling increased investor activity amid uncertainty.

11 February 2026: Continued Decline Amid Mixed Technical Signals

HCL Technologies extended its decline on 11 February, closing at Rs.1,551.20, down 1.34%. The Sensex continued its modest ascent, gaining 0.13% to 37,256.72. Technical indicators remained mixed, with the MACD mildly bearish on weekly and monthly charts, RSI neutral, and Bollinger Bands suggesting sideways to bearish pressure. The stock traded below key moving averages, reinforcing the cautious technical outlook. Volume decreased to 62,140 shares, reflecting some hesitation among traders.

12 February 2026: Intraday Low and Heightened Price Pressure

The stock faced significant selling pressure on 12 February, hitting an intraday low of Rs.1,498, a 3.43% drop from the previous close. It ended the day at Rs.1,476.10, down 4.84%, underperforming the Sensex which fell 0.56%. Volume surged to 660,309 shares, reflecting active trading amid volatility. HCL Technologies traded below all major moving averages, signalling sustained downward momentum. The broader market showed signs of softness, with the Sensex trading below its 50-day moving average despite being near its 52-week high.

13 February 2026: Sharp Gap Down, Heavy Trading, and Put Option Surge

On 13 February, HCL Technologies opened with a sharp gap down of 4.2%, reflecting intensified selling pressure. The stock touched an intraday low of Rs.1,396, a 5.43% decline from the prior close, before settling at Rs.1,454.95, down 1.43% on the day. Total traded volume reached 1,348,208 shares, with a traded value exceeding ₹21,149 crores, making it one of the most actively traded stocks by value. Despite the heavy volume, the stock underperformed both the Sensex, which fell 1.40%, and the IT - Software sector, which declined 4.41%.

Put option activity surged, with 4,517 contracts traded at the ₹1,400 strike price expiring on 24 February 2026, signalling growing bearish sentiment and hedging. The stock’s Mojo Score remained at 62.0 with a Hold rating, reflecting a cautious stance amid technical deterioration and valuation concerns. The adjusted beta of 1.23 indicates heightened volatility relative to the broader market.

Key Takeaways

Valuation and Rating Shift: The downgrade from Buy to Hold by MarketsMOJO reflects concerns over stretched valuation multiples, with HCL’s PE ratio at 25.3 exceeding industry peers. This rating change coincided with a shift in technical momentum from mildly bullish to sideways, signalling a pause in upward price trends.

Technical Weakness and Price Pressure: The stock’s consistent trading below all major moving averages and the four-day losing streak culminating in an 8.70% weekly decline highlight significant technical headwinds. Intraday lows of Rs.1,498 and Rs.1,396 on 12 and 13 February respectively underscore the selling pressure.

Heavy Trading and Institutional Activity: Despite the price decline, HCL Technologies saw robust trading volumes and value turnover, with over ₹21,149 crores traded on 13 February. Delivery volumes surged, indicating active repositioning by institutional investors amid volatility.

Bearish Options Market Sentiment: The surge in put option activity at the ₹1,400 strike price expiring on 24 February suggests heightened hedging and bearish speculation, reflecting market caution about near-term downside risks.

Sector and Market Context: The IT - Software sector’s 4.41% decline on 13 February and the Sensex’s 0.54% weekly fall provide a challenging backdrop. HCL’s underperformance relative to both benchmarks indicates company-specific pressures alongside broader sector weakness.

Dividend Yield Support: The stock maintains a relatively high dividend yield of approximately 3.66%, offering some income cushion amid price volatility, which may appeal to income-focused investors despite the current downtrend.

Long-Term Performance Contrast: While recent performance has been weak, HCL Technologies has delivered strong returns over longer horizons, outperforming the Sensex over 3, 5, and 10 years, underscoring its fundamental resilience despite short-term challenges.

Conclusion

HCL Technologies Ltd’s week ending 13 February 2026 was marked by a pronounced decline of 8.70%, driven by a combination of valuation concerns, technical deterioration, and sectoral headwinds. The downgrade to a Hold rating and the shift to sideways technical momentum signalled a cautious market stance. Heavy trading volumes and elevated put option activity reflect active repositioning and hedging amid uncertainty. While the stock’s dividend yield and long-term fundamentals remain supportive, the near-term outlook is tempered by persistent price pressure and underperformance relative to the Sensex and IT sector. Investors should monitor technical signals and sector developments closely as the stock navigates this consolidation phase.

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