Fitch believes that IT services companies focussed on digital businesses such as automation software and cloud-based service delivery, are likely to perform better than those with a focus on business process management
BENGALURU: Indian IT services sector is likely to resume high single-digit revenue growth in 2021-2022 on higher demand for digital transformation, said Fitch Ratings in a new report.
On an average, industry-wide revenue declined 6% q-o-q in Q2 FY20, according to Nasscom as project delivery was affected by lockdowns and demand fell amid business disruption. Sectors such as aviation and hospitality have suffered severe downturns and have sharply cut their IT spending.
“The impact of the coronavirus pandemic is likely to be only moderate and “short term”, as customers focus on transforming their businesses digitally, moving services and work platforms online, and minimise spending on legacy services,” the report said.
The industry is expected to take advantage of its low-cost operations and maintain its strong foothold in the global IT sector. It will continue to remain export-driven as it mainly serves US and Europe-based clients.
Source: livemint
