
IT Firms: Mind The Bend
Demand slowdown has forced the big boys of Indian IT to cut their growth outlook for FY24. As macro uncertainty looms large, companies are shifting focus to controlling costs to protect profitability.
Demand slowdown has forced the big boys of Indian IT to cut their growth outlook for FY24. As macro uncertainty looms large, companies are shifting focus to controlling costs to protect profitability.
Sequentially, the profit declined 28.7% as against ₹692.5 crore in the June quarter.
Post Q2 results, the U.S.-listed shares of Infosys plunged 6.5% to $16.46 in overnight trade on NYSE after the IT heavyweight cut revenue guidance for the second in a row.
Group MD & CEO Anish Shah has delivered a steep increase in RoE while pushing for fast growth in all group businesses.
U.S.-based Accenture gave a bleak revenue growth guidance of 2-5% year-on-year in constant currency terms for the financial year 2023-24 (FY24).
Tech Mahindra reported a 39% decline in its profit to ₹693 crore as against ₹1,131 crore in the corresponding period last year, which was lower than analyst expectations of ₹1,100 crore.
Brokerages have turned bearish on the stock after the IT heavyweight reported lower than expected earning in the June quarter.
The IT heavyweights are expected to report weak earnings in June quarter with flattish sequential growth in CC terms due to soft demand outlook with limited large deal ramp ups.
Shares of TCS, Infosys, Wipro, HCL Technologies, and Tech Mahindra fell up to 2%, in sync with a weak broader market.
As US recession looms large, Indian IT services companies are bracing for a hard landing.