IT Q3 preview: Large deal wins to drive earnings but margins may take a hit

Brokerages expect large-cap IT firms to report revenue growth in the range of 2-3 per cent in constant currency (cc) terms

In a departure from past trend, Indian IT companies may post a strong performance for the third quarter of the financial year 2021 (Q3FY21) on account of healthy order pipeline, large deal signings and going by strong earnings from Accenture, believe analysts. Further, improvement in demand post Covid-19, acceleration in adoption of public cloud model, lower furloughs and decent growth in sectors such as consumer, technology and healthcare are likely to add to the revenues of the IT companies, they say.

Usually, December quarter is considered to be a seasonally weak quarter for IT companies due to lower working days.