Buildings in the Parel area of Mumbai. — Bloomberg
BENGALURU: India’s information technology (IT) companies, among the worst-performing sectors this year, may not see a recovery in financial year 2026 (FY26), according to analysts.
This was after Accenture flagged weak discretionary spending and demand in its quarterly report.
Accenture, the world’s largest IT services player and a bellwether for the Indian IT industry, warned last Thursday that spending on discretionary projects in the quarter “was still constrained” and flagged no meaningful increase in client budgets.
Escalating global trade tensions following fresh US tariffs on trading partners has sparked concerns over a slowdown in the United States – a key market for Indian IT companies.
“Whatever has happened in the last two months has created a higher level of uncertainty in terms of how the first half of FY26 will pan out and what impact it will have on the FY26 recovery rate,” HDFC Securities deputy vice-president Amit Chandra told Reuters.
India’s IT index is currently down 15.3% so far this year and is set for its worst quarter since June 2022.
Top firms such as TCS, Wipro, Infosys and HCLTech lost between 11.2% and 18.1% this year. — Reuters
