Has IT Sector Bottomed Out?

Three months into FY25, CEOs are still skeptical about a full recovery.

- RUKMINI RAO

EARLIER IN JULY, India’s largest IT services company, Tata Consultancy Services (TCS), reported a 4.4% YoY growth in constant currency terms in Q1FY25. However, in its largest geography, North America, and its largest vertical, BFSI, revenues declined 1.1% and 0.9%, respectively. The company said customers were making decisions at a short notice based on macroeconomic conditions. However, K. Krithivasan, CEO and MD, was hesitant when asked if the sector had bottomed out. “It is a scenario of more wait and watch.” The company said customer sentiment had still not materially changed in last three months. “Cost optimisation projects get priority over new discretionary projects if they (clients) are not able to see a short-term RoI,” it said.