IT Cos Likely To Post Sluggish Q4 Results

TCS is likely to see ramp down of BSNL deal, while Infosys will witness low pass through. Similarly, seasonality in software business and ending of a large project in retail vertical will affect revenue growth of HCLTech. Wipro is likely to report some ramp downs in projects

Bengaluru: Indian IT firms are likely to post subdued Q4 performance with large IT services providers posting flattish revenue growth during this period. IT services companies will start reporting their fourth quarter performance for FY25 from second week of April onwards.

TCS, the market leader, will announce its Q4 results on April 10, while Infosys will give its numbers on April 17. Wipro’s financial results will be released on April 16, while HCLTech will announce it on April 22. Financial results of Tech Mahindra will be announced on April 24.

“QoQ (quarter on quarter) growth is expected to remain muted in Q4. All tier-1 companies are expected to report either a flattish trend or a sequential decline in revenue growth,” brokerage firm, Emkay Global wrote in a note.

“We have been optimistic about recovery in discretionary spending given the improving macro environment, leading to uptick in revenue growth in CY25/FY26. However, increased probability of slowdown or recession in the US with implementation of tariffs is expected to impact growth and tech spending, especially discretionary spending. We have lowered our earnings estimates…largely due to risks to uptick in discretionary spending and overall tech spending,” the report said.

The brokerage firm also pointed out that company-specific issues would impact the revenue growth in the fourth quarter. TCS is likely to see ramp down of BSNL deal, while Infosys will witness low pass through. Similarly, seasonality in software business and ending of a large project in retail vertical will affect revenue growth of HCLTech. Wipro is likely to report some ramp downs in projects, affecting its revenue growth in Q4 of FY25.

Despite tepid revenue growth, the BFSI (banking, financial services & insurance) vertical would continue to post robust growth during the fourth quarter. “BFSI continues to show encouraging signs, while communication and manufacturing (particularly auto) remain weak. BFSI recovery augurs well for CY25/FY26 growth, although uncertainties on the pace of recovery in other verticals persist,” the report noted.

The growth phenomenon is not likely to be very different for mid-tier IT firms with most reporting tepid revenue growth numbers. Among mid-tier IT firms, Coforge and L&T Technology Services are likely to post better revenue growth than others during the fourth quarter.

“Companies are likely to report a mixed performance on margins, depending on salary hike (Infosys, Tech Mahindra, HCLTech) and large deals ramp-ups,” the report said.

Factors like management commentary on revenue growth projection for FY26, margin expectations, discretionary spend and overall demand environment will be keenly watched by investors.