Nasscom sees FY15 IT-BPO revenues at low end of target

Sector seen at $146 b, exports at $98.5 b

Nasscom, the premier trade body and the chamber of commerce of the IT-BPO industries in India, expects the Indian IT industry to grow by 13 per cent in the current fiscal (FY15) to aggregate $146 billion.

Out of this, $98.5 billion is from exports which are forecast to grow 12.3 per cent, below the lower- end of the 13-15 per cent target set earlier. The remaining $48 billion is from domestic revenues, which is forecast to record an annual growth of 14 per cent. The IT industry body had in its earlier forecast stated that the industry will overall grow by 13-15 per cent this fiscal.

Nasscom has projected a flattish 12-14 per cent export growth for FY 2015-16 at $110-112 billion. Overall revenues for the next fiscal is projected to touch $165 billion-$169 billion, a growth target of 13-15 per cent. Nasscom expects a 15-17 per cent growth in the domestic segment in FY 2015-16, including the fledgling ecommerce segment, and  reach $55-57 billion during the year.

“We are delighted with the robust growth demonstrated by the industry during the current fiscal year. The industry today has a very diverse landscape which is constantly evolving and fuelling growth for the industry,” Nasscom chairman R Chandrasekaran said.
Digital also became mainstream during the year, with industry increasingly investing in digitised solutions to drive future growth opportunities.Digital solutions in the year accounted for 12-14 per cent of the industry revenues.

Exports to the US, the largest market, is forecast to grow above industry average, aided by an economic revival and higher technology adoption. Demand from Europe remained strong during the first half of the year, but softened during the second half due to currency movements and economic challenges. Manufacturing, utilities and retail growth remained strong as clients increased discretionary spend on customer experience, digital, analytics, ERP updates and improving overall efficiency, according to Nasscom.

The year also witnessed hyper growth in the technology start-up and product landscape and India is already ranked as the fourth largest start-up hub in the world, Nasscom said.

“The future looks very promising as the IT BPO industry is gearing itself well to next phase of challenges. Digitisation, disruptive technologies and innovation will fuel growth with new opportunities in the years ahead,” Nasscom vice chairman BVR Mohan Reddy said.

Executive Chairman of Happiest Minds Ashok Soota said the impact of cross-currency fluctuations will be felt more in the next financial year. “Indian companies are facing heat from the second quarter of the current financial year. During the third-quarter results also they really felt its impact on their net profit,” he said.

“Every company should be following their forex hedging policy and this will help them to withstand the adverse effects,” said Soota.