Sandip Agarwal (Fund Manager and Co-founder at Sowilo Investment Managers) believes the Indian IT sector is poised for a 20-30% index-level return in the near future. He notes that while companies like Tata Consultancy Services (TCS) have reported record Total Contract Value (TCV) of $12 billion, revenue growth remains sluggish due to a disconnect between deal wins and actual revenue, a situation exacerbated by enterprise clients' indecision regarding IT budget allocations. Agarwal estimates that AI will reduce operational requirements by 20-30%, translating to a 3-4% annual revenue deflation over the next few years. However, he maintains that large IT firms can achieve 6-7% dollar revenue growth, leading to an annual earnings per share growth of 13-14%. He advises investors to focus on traditional IT services and avoid companies with heavy engineering research and development exposure, which currently face greater risks. Looking ahead, Agarwal expects FY27 to outperform FY26, marking a recovery for the sector.