Indian IT Firms Slash Guidance Revenue Forecasts

A shocking trend was seen after the leading IT firms in India slashed their revenue guidance across the board as growth faltered. Reports have claimed that in the second quarter of the current fiscal year, a total of 7 IT companies reported their financial numbers but 5 out of 7 IT firms have revised their guidance downward in a tough demand environment causing a faltering growth. Those five IT companies are HCL Tech, Infosys, L&T Services, and Happiest Minds. Reportedly, all five firms have cut their revenue guidance forecasts while Wipro (another leading IT firm) guided for lower degrowth than expected. If you are scrambling to the web regarding the same, stick with this page and go through it till the end. Swipe down the page.

IT Firms

Talking about the leading IT firms of India such as Tata Consultancy Services (TCS) and LTIMindtree, they do not offer a revenue growth guidance target. It is expected that Tata Consultancy Services’s growth for this year will be in single digits. For the second quarter of FY24, Wipro was the latest large company to declare its results. Reportedly, Wipro offered a muted revenue growth guidance for the third quarter of the current fiscal year, which is anticipated to remain lower than expected at around -3.5 to -1.5 percent.

Aparna Iyer who is the Chief Financial Officer said the revenue guidance depicts a weak revenue environment. She added in a Kotak Institutional Equities note, “The weak guidance captures higher furloughs, continued weakness in discretionary spending and higher exposure to the same and some revenue leakage due to wallet share loss,”  The guidance indicates the persistence of weak trends, and Wipro is “on a sticky wicket with continued growth underperformance versus peers, senior executive attrition, lack of mega deals and revenue leakage”. Continue reading this article to know more.

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Infosys which is the second-largest IT company in India, slashed its guidance significantly at the end of the first quarter, lowered the upper end of its guidance this quarter, and anticipates revenue growth at 1-2.5 percent. Chief Executive Officer Salil Parekh told analysts that there are delays in the starting of large programs, and deal closures are also taking longer, “We are seeing discretionary spend which is coming down and we saw that continuing on transformation programs being slow, that is also continuing on in this quarter,” He said factors in the third and fourth quarters are weak for the sectors.

Amzad Khan
Amzad Khan

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