Latest news with #ITsector
Entrepreneur
29-07-2025
- Business
- Entrepreneur
IT Sector's Muted Q1 Trend Likely to Continue through FY26
The Indian IT sector is expected to witness a flat revenue growth of 0-2 per cent in FY26 as compared to the previous year in terms of constant currency revenue growth, according to CareEdge Ratings You're reading Entrepreneur India, an international franchise of Entrepreneur Media. The Indian IT services industry has experienced muted growth during the first quarter earnings as clients across sectors continued to delay or defer discretionary projects due to macroeconomic uncertainty and cost pressures. Despite some commentary on a better second half of the fiscal, CareEdge Ratings believes the Indian IT sector is expected to witness a flat revenue growth of 0-2 per cent in FY26 as compared to the previous year in terms of constant currency revenue growth. This is underpinned by a healthy deal pipeline poised to convert into wins over the near term, ensuring revenue visibility for the next few quarters. "Increasing digitisation and rise in demand for emerging technologies like 5G, advanced data analytics, artificial intelligence, cloud computing, cyber-security, robotics and blockchain provide growth opportunities for Indian IT/ITeS firms," CareEdge said in a report. It further stated that, "The uncertainty arising from tariffs and movements in the US market is a significant concern for the IT industry, as a large proportion of its revenues are derived from the US market. The IT-software industry has been re-aligning its offerings to cater to the evolving requirements of its clients with respect to emerging technologies to become more effective in the dynamic business environment. Growth remains muted in key markets, as clients are cautious in spending prioritizing cost optimisation and vendor consolidation." Tata Consultancy Services (TCS) reported muted growth in core markets (except India) due to deferrals and decision-making delays in Q1. Deal TCV has been strong for last three quarters, up 7.4 per cent YoY, but revenue growth in core markets has been flat at -0.7 per cent YoY USD due to re-scoping, delay in ramp-up and elongation in deal tenure. Pace of client decision making did not improve in Q1. Management believes that uncertainty would persist until trade deals between US and all major countries are finalised. Management reiterated its target to grow better in international markets in FY26 versus +0.5 per cent YoY USD in FY25. "We continue to value the company at 24x on Q3FY27-Q2FY28 EPS of INR 152.9 to arrive at our target price of INR 3,670. We continue to like TCS for better execution, profitability and return metrics in the industry," ICICI Securities said in a note. Wipro grew marginally better than expected at -2 per cent in constant currency, within its guided range for Q1, led by the healthcare and technology verticals. Guidance for Q2FY26 is flat at the midpoint. With a strong TCV and two mega deals, focus shall be on execution of these mega deals. "Though Wipro has indicated that H2FY26 will likely be better than H1 on the back of these deals, negative seasonality of H2 will also be at play. The company has indicated that margin might be impacted on upfront investment for large deals for a few of the quarters. WPRO has been losing clients and has trouble gaining broad-based growth traction across verticals. We factor in a -0.5 per cent IT services revenue USD growth print for FY26. We cut FY26–28E EPS by about 1–2 per cent and maintain 'Reduce' with a one-year forward target price of INR 240 on a target PE of 18x," ICICI Securities said. LTIMindtree reported in-line revenue growth led by a recovery in consumer and healthcare segments, and healthy momentum in BFSI. EBIT margin improved about 50 basis points QoQ on expected lines, enabled largely by its focused margin improvement program. TCV wins have been healthy with TCV up 13.6 per cent YoY over the last three quarters. "But this is yet to translate into revenue growth (5.3 per cent YoY USD over same period). Management is focussing on execution i.e. improving its large deal pipeline and win rates amidst a challenging macro environment and expects revenue growth momentum to improve from here on. We continue to value LTIMindtree at 22x on Q3FY27E to Q2FY28E EPS of INR 215 to arrive at a revised target price of INR 4,740. We maintain 'Reduce'. LTIM has higher exposure to its discretionary portfolio, constraining its growth in the current weak macro," ICICI Securities said.
Yahoo
28-07-2025
- Business
- Yahoo
TCS to cut more than 12,000 jobs amid AI-led disruptions
Indian IT services company Tata Consultancy Services (TCS) has announced its intention to reduce its workforce by 2% in response to AI-driven disruptions and macroeconomic uncertainties. This decision will lead to approximately 12,200 job cuts, Reuters reported, citing a company statement. The reductions will primarily affect middle and senior management employees. 'This transition is being planned with due care to ensure there is no impact on service delivery to our clients," TCS said. As of June 2025, TCS had more than 610,000 employees. The announcement came as the Indian IT sector, valued at $283bn, is experiencing similar challenges. Clients are reportedly delaying non-essential technology spending due to weak demand, persistent inflation, and uncertainties surrounding US trade policies. Earlier in July 2025, TCS chief executive K Krithivasan also noted that client decision-making and project initiations are facing delays. The restructuring effort is aimed at transforming the company into a future-ready organisation. 'This includes strategic initiatives on multiple fronts, and while these changes are necessary for our growth and evolution, we understand the impact on our colleagues. We thank them for their service and are committed to supporting them through this transition,' The Times of India quoted Krithivasan as saying in an email to employees. The company is currently focusing on deploying AI and other technologies while exploring new markets and managing an unpredictable demand landscape. In June 2025, TCS announced the establishment of three new facilities in Europe to bolster its presence in the software-defined vehicles sector. This includes two automotive delivery centres in Germany, located in Munich and Villingen-Schwenningen, and an engineering facility in Romania. "TCS to cut more than 12,000 jobs amid AI-led disruptions" was originally created and published by Verdict, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Bloomberg
28-07-2025
- Business
- Bloomberg
Investors Look to Gold as Indian Stock Market Shows Signs of Strains
Before the trading day starts we bring you a digest of the key news and events that are likely to move markets. Today we look at: Good morning, this is Ashutosh Joshi, an equities reporter in Mumbai. Nifty futures are flatlining, setting the tone for a cautious start to the week for Indian stocks. After four straight sessions of losses, investors are playing it cautious. The mood in regional markets isn't exactly helping either. Investor focus today will be on earnings from IndusInd Bank and Bharat Electronics. Meanwhile, TCS's plan to slash 12,000 jobs could likely worsen IT sector's already bleak outlook.
Bloomberg
18-07-2025
- Business
- Bloomberg
Indian Markets May Continue Weekly Loss on Tepid Axis Bank, Wipro Earnings
Before the trading day starts we bring you a digest of the key news and events that are likely to move markets. Today we look at: Good morning, this is Chiranjivi Chakraborty, an equities reporter in Mumbai. Indian shares are set to post their third straight week of losses, a streak not seen since early March. High valuations aren't helping, and a disappointing earnings season, especially from the IT sector, is pushing the recovery timeline out further. All eyes are now on Reliance Industries, which is set to report its first-quarter results later today. Meanwhile, solar stocks might take a hit as US rivals call for tariffs on imports.
Yahoo
16-07-2025
- Business
- Yahoo
India IT demand outlook remains uncertain amid US tariff risks, says Wipro chair
BENGALURU (Reuters) -The demand outlook for India's $283-billion IT sector remains uncertain due to U.S. tariff risks and global geopolitical factors, a senior Wipro executive said on Wednesday. "Customers are getting acclimatised to living in a world that is uncertain," said Rishad Premji, executive chairman of the country's fourth-largest IT firm by revenue. "The (overall) environment remains uncertain. It has not gotten any worse but not gotten significantly better at the moment." He was speaking at the company's annual shareholder meeting ahead of first-quarter results scheduled to be announced on Thursday. Clients have tightened non-essential or discretionary spending and are focussing more on cost-cutting projects enabled through tech, said Premji. Uncertainty around U.S. tariffs have dashed hopes of IT companies of a revival in client confidence and spending in its biggest market. A survey in May showed two in five tech executives had deferred discretionary projects. Premji, however, said green shoots had emerged in pockets in terms of discretionary spending. Indian IT companies have so far reported tepid earnings for the June quarter. Last Thursday, bellwether Tata Consultancy Services missed quarterly revenue estimates as its clients stayed cautious about non-essential spending amid U.S. tariff-related uncertainty. TCS CEO K Krithivasan said delays in decision-making and project starts "intensified" in the June quarter, adding that it was "too early" to predict when the growth would resume. HCLTech reported June-quarter profit below analyst estimates on Monday and lowered its operating margin forecast for fiscal 2026. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
