Weak outlook

Growth in the IT sector will remain muted

The information-technology (IT) sector remains under pressure. This is visible in market action, muted second-quarter results, and guidance cuts, as well as the pattern of hiring. Managements are cautious and looking forward to 2024-25 for a rebound in demand. Sector analysts have cited weak global activity and high interest rates as inhibitory factors. The results of the big three firms throw up some broad conclusions, which are likely to be reflected in the forthcoming results and guidance of smaller companies in the sector. IT firms are looking at aggressive cost cuts and cost rationalisation to maintain margins. While mega deals