Investors shrug off muted growth in IT services cos

Are investors of the country's five largest IT services companies getting ahead of themselves?

- Jas Bardia & Varun Sood

BENGALURU/NEW DELHI:

The largest homegrown IT services firms—Tata Consultancy Services Ltd, Infosys Ltd, HCL Technologies Ltd, Wipro Ltd and Tech Mahindra Ltd—grew at a slower clip in the first nine months of the current calendar year compared with the year-ago period, defying analysts' and management's estimates that 2024 will be better than 2023 when the $254 billion industry reported its weakest growth.

Still, save for Wipro, shares of the remaining four IT firms fared better this year than in 2023.

In the first nine months of the current calendar year, TCS, Infosys, and HCL reported dollar revenue growth of 4.21%, 2.02%, and 6%, respectively. Wipro and Tech Mahindra saw their full-year revenue decline 4% and 2.5%, respectively.

TCS, Infosys, and HCL reported higher growth of 5.4%, 2.8%, and 6%, respectively, in the calendar year 2023. Wipro and Tech Mahindra fared better last year, as revenue fell 0.5% and 2.3%, respectively.