Starting next week, the country’s largest IT services company, Tata Consultancy Services (TCS), will release its Q1FY24 financials. These companies are projected to report poorer revenue growth due to lower discretionary spending and pockets of weakness in mortgage, retail, and telecommunications.
In the company’s annual general meeting, TCS chairman N Chandrasekaran stated that there will be volatility in different markets on client spending in the coming quarters. Despite these issues, IT CEOs have stated that clients are focusing on cloud, IoT, and generative AI (artificial intelligence).
Despite the fact that June is a seasonally strong quarter, analysts predict that sales would fall for Wipro and Tech Mahindra and remain constant for TCS. Emkay Global Financial Services forecasts constant currency revenue growth of -2.3% to 1% for tier-1 firms and -1.6% to 3.4% for mid-cap firms.
It expects Infosys to maintain its FY24 revenue growth target of 4-7% in constant currency and EBIT margin of 21- 22%. HCL Tech is also expected to maintain its FY24 overall and services projection of 6-8% and 6.5-8.5% constant currency year on year (YoY), respectively, as well as an EBIT margin of 18-19%. According to Emkay Global, Wipro’s constant currency quarter-on-quarter (QoQ) revenue growth is projected to be flat (-1 to 1%).
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