Among the large global IT services and consulting companies, Dublin-headquartered Accenture has been calling out AI-generated revenue for nearly a year. More recently, Noida-headquartered HCL Technologies has now started giving a breakup of advanced AI, now nearly 3% of its total revenue. India’s largest IT company, Tata Consultancy Services, on the other hand, will now be building AI data centres in India as a part of future-proofing.

While others are yet to start sharing a breakup, most companies over the last 6-8 quarters have been announcing a slew of partnerships with big tech firms and chip companies and working on a range of pilot projects. Given this, Nomura analysts see that the addressable market for IT services companies increases over time in each tech cycle. “The role of system integrators such as IT services companies is likely to persist, considering their role in managing a complex IT landscape for clients, especially in the AI world,” said a recent note.  

With IT firms now making investments, and as well as increasing the internal and external use of AI, along with co-creating AI roadmaps for clients, “We think clients are gradually moving from proof-of-concept projects to standalone implementations of AI. Bigger revenue pools for India IT service providers should emerge when enterprise adoption of AI happens, which we think is likely to gather pace in the next 12-18 months. This should also lead to improved demand for cloud services and data standardisation”, the note of 28th November said.  

Among the large caps, putting AI to real-world use has also seen companies looking at differentiators and creating new AI divisions within the company to accelerate AI adoption and sales. For instance, in the medium to long term for TCS,  “We have three growth engines that will drive demand in the AI era: hyperscaler expansion, a new wave of AI-native companies, and rising enterprise and public-sector AI needs”,  K Krithivasan, CEO &MD of TCS, to Fortune India.

As TCS and TPG  look to invest up to Rs 18,000 crore ($2 billion) over the next 5-7years to build a 1GW AI data centre in India, “India’s capacity buildout is just getting started, and we are concentrating on facilities that will exclusively cater to AI workloads where supply is lagging demand. Our differentiation is coupling infrastructure with services and partnerships, so clients get an integrated path to deploy and scale AI. As these capabilities mature, we’ll export that expertise to other markets,” Krithivasan added.  

With the India IT industry having faced a sluggish growth in FY25 owing to macro uncertainties and enterprises tightening discretionary demand, FY26 is expected to be slightly better with global corporations now spending on cost optimisation deals with AI infusion.  “We expect the average FY27F EBIT margin to improve by 30bp for our covered large-cap companies and by 50bp for the mid-caps over FY26F”, analysts at Nomura noted.  

Similarly, brokerage firm Motilal Oswal in its latest India strategy report indicated that with compute, storage, and infra layers now largely built out, incremental spending would shift toward AI software and services – mirroring the cloud transition of 2016-18, when IT services growth accelerated as hardware spending plateaued. “We expect AI services to reach an inflexion point over the next 6-9 months, driving meaningful growth in 2HFY27 and a full-scale uptick in FY28 as enterprises move from pilots to broad deployment,” the report said.