MUMBAI: For the first time in 25 years, IT industry body Nasscom has deferred giving the revenue outlook for the Indian IT-BPM industry by a quarter, which reflects the state of flux that the $155-billion Indian IT sector is in.
Nasscom is taking a more calibrated approach of seeking feedback from key stakeholders — IT companies and analysts — to improve its forecasting after the original one went awry.
Nasscom president R Chandrashekhar said that quantifying positive outlook does require some more effort. “Given the kind of uncertainties and the fact that we had shared the revised guidance in November, nothing much has happened between then and now to increase or reduce the extent of uncertainty. We do hope that over the next quarter, we will give a reliable and accurate estimate. The writing on the slide is very clear.”
The software body’s chairman C P Gurnani said, “If we wanted to give a guidance, we could have guided for 6-10% growth. But due to political uncertainties and state of our own industry due to digital transition, we have deferred guidance till next quarter.”
Nasscom had lowered the forecast to 8-10% (in constant currency) for 2016-17, from 10-12% that it had provided at the beginning of the financial year. The move was widely expected, given that company after company was reporting lower than expected revenue growth. Unexpected outcomes in the Brexit vote and the US presidential election had created a lot of uncertainty, resulting in delayed decision-making and deferment of IT spends. Phil Fersht, CEO of HfS Research, said that the IT services market is in a state of flux because of Trump’s impending executive order on H-1B visas and other potential immigration issues. “However, despite the uncertainty, it should be possible to factor these in and make some predictions,” he added.