Global slowdown may prevent Indian IT's milestone mark

Top tier IT companies in India are unlikely to achieve the Rs 1 lakh crore quarterly revenue mark owing to the impending slowdown in the global economy.

Top tier IT companies in India are unlikely to achieve the Rs 1 lakh crore quarterly revenue mark owing to the impending slowdown in the global economy.

The top 5 IT services companies -- TCS, Infosys, HCL, Wipro and Tech Mahindra -- need a mere 1.6% sequential growth in their revenues during the quarter ended March 2019 to touch the Rs 1 lakh crore revenue mark. However, if most analysts are to be believed, they might fractionally fall short of the mark, that has eluded them for two quarters already.

On the back of rupee appreciation, the IT sector, in the last quarter had seen less than expected growth, when the top 5 clocked a combined topline of Rs 98,400 crore -- just Rs 1,600 crore short of the Rs 1 lakh crore mark.

This quarter as well, the combined revenue of the top 5 is expected to grow by 1.5% sequentially -- just 10 basis points short of the requisite growth rate for the milestone mark, analysts tracking the sector said.

Among the Tier-I IT companies, Noida-based HCL Technologies is expected to lead the growth, with little over 2% sequential growth in the topline, followed by TCS, whose revenues are expected to grow around 1.3% sequentially.

On a year-on-year basis, the top 5 IT services companies are expected to show strong double-digit growth. Tech behemoth TCS is expected to grow its topline around 18% on Y-o-Y basis, Infosys (around 19%) and HCL (around 22%). While Tech Mahindra and Wipro are expected to grow by 13% and 12% respectively.

HCL's strong growth has been led by strong demand for IT Infrastructure Management Services (IMS) and growth in Banking, financial services and insurance (BFSI) vertical.

The fourth quarter usually witnesses a muted growth across the IT services sector.

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