Shares of Infosys Ltd, one of India’s leading IT services firms, fell by almost 15% on Monday. This decline impacted peers and the benchmark index as well, due to concerns about the demand for Indian IT services amidst global banking turmoil and recession fears. Infosys had released a disappointing revenue outlook last week, following the release of a disappointing quarterly report by its larger rival Tata Consultancy Services. More than 25% of the IT sector’s revenue comes from the U.S. and European banking, financial, services and insurance sector. The collapse of two mid-sized U.S. lenders in March had left the financial ecosystem shaken and driven an extraordinary government effort to reassure depositors and backstop the system.
MDS SI granted highest status in Dell Technologies Partner Program for 2023
Qatar Tourism launches Hayya Platform for unified tourist and business visa processes
Apurva Prasad, Vice President of Institutional Research at HDFC Securities, stated that “some of the macro challenges, especially around banking, financial services and insurance (BFSI) has become bigger and that does mean project cancellations or delays in the deal decision cycle”. Prasad also expected a sequential decline for companies like HCLTech, Wipro and Tech Mahindra on a constant currency basis.
Infosys announced that it expects revenue growth of 4%-7% on a constant currency basis for the fiscal year ending March 2024, well below analysts’ expectations of 10.7% growth. The company cited the cancellation of some projects and the deferral of spending by clients as reasons for the poor outlook, as fears of a recession grew.
