{"id":58576,"date":"2023-06-01T14:58:35","date_gmt":"2023-06-01T06:58:35","guid":{"rendered":"https:\/\/news.outsourceaccelerator.com\/?p=58576"},"modified":"2023-06-01T14:58:35","modified_gmt":"2023-06-01T06:58:35","slug":"icra-predicts-slump-in-indian-it","status":"publish","type":"post","link":"https:\/\/news.outsourceaccelerator.com\/icra-predicts-slump-in-indian-it\/","title":{"rendered":"ICRA predicts slump in Indian IT growth, hiring in FY24"},"content":{"rendered":"
NEW DELHI, INDIA \u2014 India’s IT sector, worth nearly US$250 billion, will face a further slowdown in revenue growth to mid-single digits in FY24, according to the domestic rating agency ICRA.\u00a0<\/span><\/p>\n Amid ongoing uncertainties, hiring in the sector is also predicted to remain at “low levels” in the near future.<\/span><\/p>\n ICRA\u2019s forecast comes on the heels of a report by the industry lobby group NASSCOM, which revealed a decline in the sector’s growth to 8.4% in FY23, down from over 15% in the previous fiscal year.<\/span><\/p>\n “Despite a strong order book and deal pipelines of Indian IT services companies, we expect the revenue growth to remain subdued in mid-single digits in USD terms in FY2024,” said ICRA.<\/span><\/p>\n However, the agency maintained a stable outlook for companies in the sector, typically recognized for having the best leverage positions.<\/span><\/p>\n ICRA cited macroeconomic headwinds in the United States and Europe. These regions generate up to 90% of the industry’s revenues as significant contributors to the slowed growth in the past two quarters.\u00a0<\/span><\/p>\n In particular, the banking, financial services, and insurance segment, accounting for nearly a third of the overall revenues, faced more substantial declines due to crises in American banks.<\/span><\/p>\n ICRA also noted a 1.90% contraction in operating profit margins to 22.9% in FY23. Despite the predicted revenue growth slowdown, the agency expects this number to remain steady.<\/span><\/p>\n Employee addition in the top five companies dropped to 83,906 in FY23, down from 273,000 in FY22, reinforcing ICRA’s prediction of low-level hiring amid continuing macroeconomic uncertainty.<\/span><\/p>\n