https://sputnikglobe.com/20220804/indias-it-firms-poised-to-grow-more-expert-says-amid-gloomy-western-investment-research-reports-1098075364.html
India's IT Firms Poised to Grow More, Expert Says Amid Gloomy Western Investment Research Reports
India's IT Firms Poised to Grow More, Expert Says Amid Gloomy Western Investment Research Reports
Sputnik International
JP Morgan, Nomura, and others forecast a pessimistic scenario for India's IT services industry in 2023 due to a "potential decline in orders from the key... 04.08.2022, Sputnik International
2022-08-04T09:13+0000
2022-08-04T09:13+0000
2023-06-19T12:41+0000
india
outsourcing
infosys
tata group
us
stagflation
recession
european union (eu)
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India's IT services sector could buck the gloomy forecasts contemplating "an end to the growth boom" and "material slowdown" in the coming quarters.According to human resources firm TeamLease, the country's IT outsourcing firms will add around 300,000 jobs this year due to continued strong demand from overseas markets. TeamLease's Digital Employment Outlook Report has said India's IT sector will "continue to remain a sunshine sector."In an interview with Sputnik, Dr. Ravi Singh, Vice President and Research Head of Share India Securities Ltd, provided a historical perspective to infuse confidence among investors, who have withdrawn approximately $350 billion from the country's IT sector.During the 2008 global slowdown, Singh noted, India's IT majors saw annualized contract values exceed previous years, with more spending by the government, healthcare, and manufacturing industries.Global brokerage houses argued that high inflation and slowing GDP growth in the Western economies would force people to spend less, resulting in less outsourcing work for Indian IT companies such as TCS, HCL, and Infosys, among others.After studying the revenue and earning profiles of 750 companies, the brokerage firm Nomura's research report in May downgraded India's top IT services firms, such as TCS and L&T Technology.Nomura analysts forecasted a "material slowdown" in the coming quarters for the $194-billion sector, which provided software services that helped global firms withstand the disruption caused by the COVID pandemic, with innovative practices boosting online shopping and remote work.However, the expert agrees that firms may cut their travel costs and some experimental projects, and divert more focus on their core businesses like cloud computing, outsourcing, and analytics over the short term.The US economy fell 0.9 percent on an annual basis in the April-June quarter, the Bureau of Economic Analysis said last week. This was the second consecutive quarter when the US economy reported negative economic growth.On Wednesday, Eurostat, the statistical office of the European Union, said retail trade volume in the EU zone had decreased 3.9% for non-food products and 2.3% for food, drinks, and tobacco.Indian firms will also benefit from the Ukrainian crisis, as the expert pointed out that Ukraine, Romania, and Poland had been emerging as proper competitors for India's outsourcing businesses over the past two to three years.
https://sputnikglobe.com/20220730/us-recession-debate-irrelevant-amid-threat-of-long-term-stagflation-experts-believe-1097959339.html
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india, outsourcing, infosys, tata group, us, stagflation, recession, european union (eu)
India's IT Firms Poised to Grow More, Expert Says Amid Gloomy Western Investment Research Reports
09:13 GMT 04.08.2022 (Updated: 12:41 GMT 19.06.2023) JP Morgan, Nomura, and others forecast a pessimistic scenario for India's IT services industry in 2023 due to a "potential decline in orders from the key market of IT" amid a slow-down of the Western economies. However, others disagree.
India's IT services sector could buck the gloomy forecasts contemplating "an end to the growth boom" and "material slowdown" in the coming quarters.
According to human resources firm TeamLease, the country's IT outsourcing firms will add around 300,000 jobs this year due to continued strong demand from overseas markets. TeamLease's Digital Employment Outlook Report has said India's IT sector will "continue to remain a sunshine sector."
In an interview with Sputnik, Dr. Ravi Singh, Vice President and Research Head of Share India Securities Ltd, provided a historical perspective to infuse confidence among investors, who have withdrawn approximately $350 billion from the country's IT sector.
"Indian IT outsourcing businesses have shown high growth during recessions in the past," Singh told Sputnik.
During the 2008 global slowdown, Singh noted, India's IT majors saw annualized contract values exceed previous years, with more spending by the government, healthcare, and manufacturing industries.
Global brokerage houses argued that high inflation and slowing GDP growth in the Western economies would force people to spend less, resulting in less
outsourcing work for Indian IT companies such as TCS, HCL, and Infosys, among others.
"To fight inflation or other economic turmoil, companies must invest in digital innovation for survival. It is most unlikely that the firms may cut their IT budget," Singh said.
After studying the revenue and earning profiles of 750 companies, the brokerage firm Nomura's research report in May downgraded India's top IT services firms, such as TCS and L&T Technology.
Nomura analysts forecasted a "material slowdown" in the coming quarters for the $194-billion sector, which provided software services that helped global firms withstand the disruption caused by the COVID pandemic, with innovative practices boosting online shopping and remote work.
However, the expert agrees that firms may cut their travel costs and some experimental projects, and divert more focus on their core businesses like cloud computing, outsourcing, and analytics over the short term.
The US economy
fell 0.9 percent on an annual basis in the April-June quarter, the Bureau of Economic Analysis said last week. This was the second consecutive quarter when the US economy reported negative economic growth.
On Wednesday, Eurostat, the statistical office of the European Union, said retail trade volume in the EU zone had decreased 3.9% for non-food products and 2.3% for food, drinks, and tobacco.
"Most Indian IT firms offer services to core businesses across sectors like government, manufacturing, banking, and healthcare. We can expect the IT service business to remain strong and growthful despite the recession," Singh underlined.
Indian firms will also benefit from the Ukrainian crisis, as the expert pointed out that Ukraine, Romania, and Poland had been emerging as proper competitors for India's outsourcing businesses over the past two to three years.
