Nomura has taken a cautious view on Indian IT services following Accenture’s Q2FY25 earnings, citing concerns around US federal contracts and rising macroeconomic uncertainty. The brokerage noted that while Accenture raised the lower end of its FY25 revenue guidance, the inclusion of over 3% inorganic growth suggests that organic momentum remains modest.
Nomura highlighted that order bookings remained stable in consulting, and the opportunity in Generative AI (GenAI) continues to expand. However, the overall commentary points to a muted demand environment, particularly in government-led tech spending in the US.
Despite these concerns, Nomura believes that growth is likely to bottom out in FY25F for Indian IT companies, creating room for gradual recovery from FY26 onward.
In terms of stock preferences, Nomura remains positive on:
- Infosys (INFY) and Cognizant (CTSH) among large-caps.
- Coforge among mid-cap IT names, citing better execution and differentiated offerings.
The cautious optimism echoes broader Street sentiment, with analysts closely monitoring Q4FY25 commentary from Indian IT majors for clarity on FY26 guidance and deal pipeline visibility.
Disclaimer: This article is for informational purposes only and is not a recommendation to buy or sell any stock. Please consult a certified financial advisor before making investment decisions.
