Indian IT Services Benefit from Hyperscaler Growth
Indian IT services companies are expected to benefit from accelerating hyperscaler growth and record backlogs, according to Antique. The brokerage maintained its 'Hold' stance on large cap companies including Infosys Ltd, Tata Consultancy Services Ltd (TCS), Wipro Ltd, HCL Technologies Ltd, and Tech Mahindra Ltd.
Antique noted that the conversion towards application demand typically lags infrastructure spending by several quarters. It expects hyperscalers to continue asking Indian IT services partners for lower prices as they invest in capacity-building.
Google Cloud revenue jumped 82% YoY to $25 billion, with a backlog of $514 billion. AWS posted its fastest growth in 18 quarters at 37% YoY, with a backlog of $496 billion. Azure grew 43% YoY, pushing Microsoft Cloud revenue to $59 billion (up 27%) and full-year Azure revenue past $100 billion.
The management teams of large Indian IT firms were explicit that macro uncertainty continues to create headwinds. Discretionary projects are being deferred or scrutinized more closely, decision cycles have lengthened, and one-off shocks are adding to the pressure on an already cautious base.