- Indian IT firms Infosys, HCL, and Wipro see market optimism after Trump’s election win.
- Tax cuts may drive technology spending; “America First” policies could challenge outsourcing.
- Analysts forecast growth for Infosys and HCL despite potential seasonal furloughs.
The Indian IT outsourcing sector is facing a mix of optimism and uncertainty following Donald Trump’s election. While his tax cuts could spur technology spending, his “America First” stance may challenge outsourcing, a key revenue source for Indian companies.
Despite these concerns, analysts believe the sector may see sequential growth as demand picks up in 2025, particularly in areas like financial services.
Indian IT Companies Adjust Strategies Amid Shifting US Business Climate
Indian tech giants Infosys and HCL Technologies are expected to post solid earnings reports. Infosys’ constant-currency revenue growth is projected to hit 6.3%, driven by financial services, while HCL’s software business is anticipated to power its growth. Both companies are positioning themselves for better growth in the coming quarters, despite challenges like seasonal furloughs and softer demand from key markets.
In the earnings forecasts, analysts expect Infosys to expand its margins thanks to better-than-expected performance in financial services, while HCL Technologies is likely to see growth from its software business. Infosys might even upgrade its revenue guidance, despite potential setbacks due to furloughs. Wipro, on the other hand, is projected to show little change in revenue due to weakness in the Americas region.
Accenture’s revenue forecast suggests an upswing in demand, particularly with the adoption of generative AI. This mirrors the trend seen in the Indian IT sector, where hiring was positive in the July-September quarter, signaling a possible rise in orders. This growth is expected to be visible in the upcoming budget cycle for key clients.
As the broader market anticipates better earnings from tech companies, other firms like Taiwan Semiconductor Manufacturing Co. and Reliance Industries are also set to post results. These companies, too, will face a mix of growth prospects and risks, including potential trade restrictions and competitive pressures in their respective markets.
Despite uncertainties surrounding the Trump administration’s policies, Indian IT companies remain poised for growth. Analysts anticipate that the sector’s resilience in the face of challenges will continue to benefit from favorable market conditions and technological advancements.
“While the rate-cutting cycle has begun and uncertainty of US presidential election is over, their impact on demand improvement is likely to be visible earliest in the upcoming budget cycle of clients.”
