IT Majors Project Healthy Fiscal Road Map With Robust Q1 Results

Pandemic-driven demand for IT services globally has brought a rich deal pipeline to India's biggest IT firms. Digital transformation in BFSI, retail, and healthcare bodes well for the future.

- DEBOJYOTI GHOSH

TOP-TIER INDIAN information technology (IT) companies posted upbeat earnings for the first quarter of the current fiscal on the back of strong demand for outsourcing services globally in a pandemic hit market. Analysts expect this momentum to continue for Tata Consultancy Services (TCS), Infosys, and Wipro for the rest of the year on the back of a large deal pipeline and robust demand outlook for their core software services and digital transformation offerings among clients.

Brokerage firms argue that for the large IT players, financial services sector will provide strong growth which will improve further in the coming quarters with the gradual opening up of the economy. This is besides growth in retail, communications, life sciences, and healthcare verticals led by digital transformation deals. In large markets such as Europe, manufacturing has partially resumed on the industrial front and the IT majors are expected to see “strong demand” for their services from the region.

“TCS flagged a robust deal pipeline driven by the multi-horizon cloud transformation cycle that will unfold over time and provide strong structural growth drivers,” Wedbush analysts Moshe Katri and Ryan Campbell argue in a note.