According to a report by Crisil Ratings, the Indian IT industry is expected to face significant challenges in the coming years due to global macroeconomic and financial headwinds. The sector, which is worth Rs 10 lakh crore, is likely to experience a decline in revenue growth of up to 9 percentage points in FY24, with growth estimated to be between 10-12 per cent compared to the nearly 20 per cent growth estimated for FY23. The senior director of Crisil Ratings, Anuj Sethi, has stated that headwinds in key markets, particularly the banking, financial services and insurance (BFSI) segment in the US and Europe, will impact the revenue growth of domestic IT services companies. The BFSI segment is expected to see mid-single digit revenue growth, which is half of what was seen previously. However, this impact will be offset marginally by 12-14 per cent growth in the manufacturing segment and 9-11 per cent growth in other segments.
The Indian IT industry is a significant contributor to the economy and supports over 50 lakh people directly. However, it has faced numerous changes recently, including some top companies reporting a decline in headcount. The rating agency analysed data from 17 companies, which account for 71 per cent of the Indian IT sector revenue, and found that the last two fiscals have been some of the best for the industry as it had put out a 19 per cent growth in FY22. The IT industry lobby grouping Nasscom has ceased its practice of giving a revenue growth estimate for the next fiscal due to the uncertain economic environment.