IT sector to see soft growth

Blitz Bureau

NEW DELHI: The Indian IT services sector is expected to experience a soft quarter growth (Q1FY26) despite the seasonal strength, according to a report released on July 8. IT companies’ earnings are expected to be mixed across the board with a very soft quarter for ER& D services companies on a quarter-on-quarter (QoQ) basis, Equirus Securities said in its report.

The report is being prepared considering Infosys and Tech Mahindra among large-cap IT companies, and Zensar, Mphasis, and KPIT eClerx among mid-cap companies on a relative basis. The financial service firm sees some sort of modification in Infosys’s FY26 sales growth guidance and soft growth in the top six large-cap IT companies.

“Infosys to guide for 1.0-3.25 per CC growth in US$ sales to largely factor incremental inorganic growth contribution of c. 0.4 per cent (earlier growth guidance of 0-3 per cent) with no change in its EBITM guidance of 20-22 per cent for FY26E,” the report said.

“The top 6 large caps to register QoQ growth of (-) 2.6 per cent to (+) 1.4 per cent in US$ Sales in CC terms in 1Q1 FY26E. Equirus Securities expects high cross-currency tailwinds QoQ across top 6 large caps in the range of 120-230 bps QoQ,” it added.

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