New Delhi, March 12 -- Indian IT stocks have been under intense pressure in recent months as fears grow that artificial intelligence could disrupt the traditional outsourcing model that has powered the sector for decades. Yet, the recent escalation in the US-Iran conflict has added a new dynamic to the outlook, raising the question of whether the beaten-down sector could emerge as a contrarian opportunity for investors.

While benchmark indices have slipped over 5% since the start of the conflict, the Nifty IT index has relatively outperformed, falling only about 3% during the same period. The limited decline reflects the sector's unique position in global markets, where currency movements and export revenues play a crucial role.

Despite...