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CIMB expects top 5 IT firms to report 1.5–4.8% QoQ revenue growth in constant currency in Q3

4 January, 2019 4:50 AM
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CIMB expects top 5 IT firms to report 1.5–4.8% QoQ revenue growth in constant currency in Q3

Earnings for the quarter ended December 2018 will be kicked off by technology companies Infosys and TCS in later part of the next week. Most brokerage expects growth to continue in third quarter driven by rupee depreciation and strong US growth.

Global investment firm CIMB expects top five IT companies to report 1.5–4.8 percent sequential growth in dollar revenue in constant currency terms.

According to the research house, country's second largest IT firm Infosys is expected to raise its lower end of FY19 revenue growth guidance and HCL Technologies is likely to maintain its guidance for dollar revenue in FY19.

After the end of Q2FY19 earnings, Infosys said it expects its full year dollar revenue growth at 7-9 percent but lowered EBIT margin guidance while HCL Tech maintained FY19 constant currency revenue growth guidance at 9.5-11.5 percent and EBIT margin at 19.5-20.5 percent.

CIMB retained its overweight stance on Infosys & Tech Mahindra as both are its preferred large cap picks. Among midcaps, it likes L&T Infotech & NIIT Technologies.

Any adverse macro event and/or regulations are downside risks, it said.

Source: moneycontrol.com

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