Did top Indian IT firms just face their worst ever quarter?

Top IT firms in India are facing what could be one of their worst quarterly results in the recent past. An already poor performance in usually week Q3 was further damaged by Chennai floods and a general slowdown in the money spent on technology globally.

Even as the Indian IT industry stands at $146-billion today, Indian tech giants like TCS and Infosys can still fall short of Nasscom's 12-14% exports growth outlook for FY16.

"Our modelling has factored in a certain figure for the likes of TCS (Tata Consultancy Services) - now we have to wait and see how the Q3 numbers turn out before we change our projections," an unnamed Nasscom executive told ET.

Experts are of the opinion that India's top five software exporters may see a 1-2% fall in revenue, or at their level best, would be able to keep a flat performance, which means that they wouldn’t be posting any profits in Q3, which ends on December 31.
TCS and Wipro, two of India's largest software exporters, have already issued warnings for Q3, and are afraid that the dark patch may well peek into the next financial year.

"This will be a pretty bad quarter for Indian IT - no two ways about it. If they even manage to post flat growth, it will be seen as a positive by investors," a foreign brokerage analyst tracking India's software outsourcing industry told ET. 2015 has proven to be one of the toughest years for IT service providers, mainly because of clients having cut back on their spending.

To top it, Chennai floods forced many IT firms to shut their offices in the city for several days, adding to the damage that has been done.

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