By Bharath Rajeswaran and Haripriya Suresh
BENGALURU (Reuters) -India’s IT firms are set for another lackluster quarter as weak global demand, steep U.S. tariffs and trade jitters weigh on earnings, six brokerages said ahead of results.
Four forecast year-on-year revenue growth of about 6% and a 5.5% profit rise for the September quarter, despite seasonal strength from project cycles.
“September … will be another muted quarter for IT,” said Abhishek Pathak of Motilal Oswal Financial Services.
“As clients reel under macro and tariff uncertainty, there is hesitation to commit additional dollars to any large initiatives.”
The projections point to continued single-digit growth, extending an eight-quarter trend as weak U.S. client spending weighs on the sector.
Indian IT firms last saw double-digit revenue growth in the March quarter of 2023, driven by digital transformation, cloud adoption and remote-work demand after the COVID-19 pandemic.
Tata Consultancy Services, India’s biggest IT firm, will open the earnings season on October 9 with revenue expected to rise about 2% year on year, compared to up about 8% in the same period last year.
Infosys and HCLTech are forecast to post revenue growth of about 8% and 9.5% respectively.
Citi Research expects fiscal 2026 to be the third straight sluggish year for IT, while Ambit Capital warned that weak macros and policy uncertainty could cap 2027 rebound.
U.S.-based Accenture last month flagged no “meaningful change” in market conditions, while forecasting full-year 2026 revenue below the LSEG-compiled estimate of 5.3%.
Banking and financial services segment is expected to hold up, while manufacturing and retail face tariff and budget pressures, Systematix Institutional Equities said.
A planned $100,000 H-1B visa fee and a proposed 25% U.S. tax on outsourcing have added to industry concerns, with analysts seeing limited near-term impact but potential shifts in delivery models.
Foreign investors have offloaded 678.36 billion rupees ($7.64 billion) of IT stocks in 2025, the biggest sectoral outflow, dragging the Nifty IT index down 20% year-to-date against a 6% gain in the Nifty 50.
Still, Axis Securities said the correction in large- and mid-cap IT stocks has improved valuations, offering a better risk-reward even if a sharp rebound takes time.
($1 = 88.7370 Indian rupees)
(Reporting by Bharath Rajeswaran and Haripriya Suresh in Bengaluru; Editing by Nivedita Bhattacharjee)
