IT Budget delays to slow down QoQ growth; all eyes on FY13
Nirmal Bang has come out with its report on IT space preview. "We expect TCS and Infosys to register net profit decline of 5.1% and 2.2% QoQ, respectively, while HCL Technologies and Wipro are expected to report 3.0% and 3.8% QoQ growth, respectively."
Nirmal Bang has come out with its report on IT space preview.
Subdued dollar revenue growth likely on delay in IT budgets: We expect the top four information technology (IT) companies in our coverage universe to post 1-3% QoQ volume growth in 4QFY12. Subdued volume growth is likely mainly due to delay in finalisation of CY12 IT budgets. On the pricing front, we expect a downward trend and factor in around 0.2-1.1% QoQ dip in blended pricing owing to an as-yet challenging business environment and intense competition, leaving little scope for a hike in billing rates. From a currency standpoint, we do not expect any significant impact as the quarterly average movement of all major currencies versus the US dollar was range-bound in 4QFY12. Overall, we expect a mere 0.3-2.9% QoQ dollar revenue growth for the top four IT firms combined, while in rupee terms we expect a negative 2.0% to positive 1.5% sequential growth owing to slight rupee appreciation (1.4% QoQ on quarterly average). It should be noted that a similar trend was observed in global consulting major Accenture