The March quarter is likely to be a modest one for IT companies with muted growth, with no major surprises expected. This is on the back of gradual reversal of furloughs and lower discretionary tech spends.

With a forgettable year out of the way, investors will keep a close watch on guidance numbers for the financial year 2025, where companies are expected to see a slight improvement in growth.

For the three months ended March 2024, largecap IT companies are seen reporting mixed numbers. While analysts pegged Tata Consultancy Services (TCS) and HCL Tech to lead the industry in terms of growth, their close competitor Infosys’ Q4 growth may still be under pressure due to continued impact of cut in discretionary tech spending and project ramp downs.

Other IT majors like Wipro, LTIMindtree and Tech Mahindra should also report a sequential revenue decline.

TCS is slated to kickstart the earnings season on April 12, followed by Infosys on April 18 and HCL Tech will announce its quarterly earnings on April 26.

Midcap IT companies to outperform largecap peers

Continuing the trend of the last few quarters, once again, quality tier-2 companies will outperform their larger peers.Large caps are seen reporting revenue growth ranging from -1.6-1.5% quarter-on-quarter and midcaps to report growth ranging from 0.7%-3.7% sequentially in constant currency (cc) terms, according to leading brokerage Nomura.Within the largecap IT universe, TCS is likely to report the strongest revenue growth of 1.5% quarter-on-quarter in cc terms and expect Tech Mahindra to post the weakest growth of -1.6% quarter-on-quarter.

In the midcaps, Nomura sees the strongest growth of 3.7% from L&T Tech and the weakest growth of 0.7% quarter-on-quarter from eClerx.

Deal wins and margins

Analysts expect deal flows likely to hold firm despite a volatile demand environment with few players such as TCS, Coforge and LTTS likely to report strong deal flow.

“Meanwhile, margins are likely to report a moderate expansion (20–40 bps) as supply-side dynamics have reversed with attrition bottoming out. A margin decline might also be seen in companies with specific situations (Infosys, HCL Tech and LTIMindtree),” said Nuvama.


IT companies are expected to take a cautious note for FY25 guidance, especially on the back of Accenture’s bleak commentary, which indicated that clients continue to limit discretionary spend.

Most analysts expect Infosys to guide for FY25 constant currency revenue growth range of 3-5%.

“We expect HCL Tech to guide for 5-7% year-on-year revenue growth in cc terms with a 18-19% EBIT margin band for FY25. Wipro may guide for 0-2% sequential revenue growth for the first quarter,” Nomura noted.


The last few months have been highly volatile for the sector, with a strong rally in December and January followed by a sharp correction in March.

Analysts see FY25 outlook to be not quite encouraging but better than that of FY24. The focus will now shift to execution of deals won in the last three quarters amid a steady improvement in the global macro environment.

“We reckon the Hi-tech and BFSI sectors will start recovering soon, followed by retail – manufacturing has always remained solid. All along, the strong deal flow momentum reinforces our positive stance on the sector,” said Nuvama.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)


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