+

Cookies on the Business Insider India website

Business Insider India has updated its Privacy and Cookie policy. We use cookies to ensure that we give you the better experience on our website. If you continue without changing your settings, we\'ll assume that you are happy to receive all cookies on the Business Insider India website. However, you can change your cookie setting at any time by clicking on our Cookie Policy at any time. You can also see our Privacy Policy.

Close
HomeQuizzoneWhatsappShare Flash Reads
 

Coronavirus: Revenue of Indian IT services cos could be hit, says report

Mar 12, 2020, 19:42 IST
PTI
New Delhi, Mar 12 () Revenue of Indian IT services companies is likely to be hit as coronavirus outbreak forces clients to enforce travel restrictions, and their deteriorating health could potentially lead to reduction in budgets, as per a report by Kotak Institutional Equities.

The report said it has cut growth estimates across companies and the revised growth forecast stands at 3-8 per cent for 2020-21.

Advertisement

"We cut revenue growth estimates for our coverage companies by 2-4 per cent after COVID-19 intensified in developed markets with many clients issuing travel advisories and instituting work-from-home measures, and deterioration in health of clients of IT companies that will potentially result in spending controls and reduction in budgets," it said.

Kotak said COVID-19 has intensified in western economies in the past few days, and many clients have instituted work-from-home measures and issued travel advisories.

"Impact on IT companies is a function of the duration and the lens through which clients view the current challenges. For now, clients across verticals have not pulled projects or programs," it said.

However, this could change since allocation of budgets to new programs starts picking pace in March/April, it pointed out.

Advertisement

"Any delays in allocations will result in companies reporting a weak June 2020 quarter," it added.

June is a seasonally strong quarter and weakness in the same could impact growth for the entire financial year, Kotak noted.

In addition to and partly as a consequence of COVID-19, client health has started deteriorating across many verticals, it said. SR RVK

(This story has not been edited by www.businessinsider.in and is auto–generated from a syndicated feed we subscribe to.)
You are subscribed to notifications!
Looks like you've blocked notifications!
Next Article