The U.S. President Donald Trump’s administration move to raise the annual H-1B visa fee from $1,000 to $100,000, a 100-fold increase, is expected to weigh on the profitability of Indian IT services companies in FY27, analysts said. They opined that no immediate earnings risks are likely, as H-1B lotteries and petitions are usually processed in Q4-Q1, meaning the financial impact would start reflecting only from the next fiscal year.

“We do not foresee any immediate risks to earnings, though a potential inch-up in onsite wage inflation due to increase in local hiring and the $100,000 fee on new H1-B visas from the next-year lottery cycle would hit earnings in FY27,” Emkay Global said in a report.

Last Friday, President Trump issued a proclamation increasing the annual H-1B visa fee to $100,000, as part of his administration’s continued efforts to tighten immigration norms. The move is likely to impact earnings of Indian IT firms such as TCS, Infosys, HCLTech, Cognizant, LTIMindtree, and others, which collectively sponsor 14,341 H-1B visas in the calendar year 2025. The top 100 companies collectively received around 106K H-1B visa approvals in CY25, as per data compiled by Emkay Global.

Starting from next year’s H-1B visa lottery cycle, the $100,000 fee will apply to new visa filings, making the use of H-1B visas more expensive and raising the cost of onsite work. However, companies have time to mitigate the impact by increasing local hiring, leveraging L1 visas, reducing reliance on H-1B visas, incorporating cost escalations in contracts, or shifting work offshore, thereby limiting the overall effect, the brokerage said in its report.

Echoing the same, Motilal Oswal also said the program’s mechanics remain the same otherwise: employers must still sponsor foreign workers for roles requiring specialised skills, but now at a sharply higher cost.

“Since H-1B lotteries and petitions are typically run in Q4–Q1, the first impact would likely be seen in FY27 petitions,” it said. Visa applications for FY26 are already locked in. The $100k fee will start to impact from FY27 onwards, when new petitions are filed, the report noted.

“The situation is still evolving and may change drastically, however we also observe following implication for Indian IT,” it added.

Over the past decade, Indian IT companies have significantly reduced their dependence on H-1B visas. With increased local hiring and localisation initiatives in the U.S., only about 20% of employees now work on-site. Of these on-site staff, 20–30% hold H-1B visas, meaning H-1B holders make up just 3–5% of the total workforce for a typical IT vendor, Motilal Oswal said in its report.

According to the brokerage house, if an IT company were to apply for 5,000 H-1Bs in FY27, the annual fee alone would amount to $500m (5,000 × $100k). Given the magnitude of this fee, it is likely that Indian IT companies will avoid new H-1B filings altogether, opting instead to expand offshore delivery or increase local hiring.

This order is likely to be challenged in US courts and may not survive in its current form, it added.

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