Kotak trims forecasts as India's IT faces West Asia headwinds
Business
India's IT industry is gearing up for a tough start in FY2027, thanks to ongoing troubles in West Asia and some productivity hiccups with managed services.
Kotak Institutional Equities has dialed down its growth forecasts for major IT firms, so they're likely to fall short of their usual targets.
GenAI pushing it prices down
Kotak trimmed revenue estimates by up to 1% and cut fair values by as much as 21%, mainly because GenAI is pushing prices down faster than expected.
The rupee's nearly 10% drop this year helps soften the blow a bit, but hedging at higher USD/INR rates could limit profits for mid-tier firms.
Plus, more mergers and acquisitions in 2026 show companies are trying to scale up and adapt quickly.