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IT earnings expectations Q4FY25

ICICIdirect Research 11 Apr 2025 DISCLAIMER

Infosys: Expect revenue decline of ~2% QoQ due to 1) lower revenues from sale of third-party items for service delivery and (2) seasonal weakness in demand and 60 bps sequential decline in EBIT margin to 20.7%, due to wage revision for junior employees, offset by rupee depreciation. Given the higher share of discretionary revenues, we expect low single digit revenue guidance for FY26.

HCL Tech: Expect revenue decline of ~1% QoQ due to seasonal weakness in the products business. We forecast EBIT margin of 18.2%, decline of 140 bps QoQ, due to lower license revenues from the products business. FY26 Revenue guidance is likely at 4-5%, also aided by CTG acquisitions.

LTIM: LTIM is expected to report flat revenues QoQ due to weak travel and hi-tech vertical. EBIT Margins, are expected at 14%, flattish QoQ. Key monitorable ahead would be the new CEO’s (Veenu Lambu) strategy for growth path after fairly disappointing last two years.

Persistent: We expect ~3.5% QoQ growth in revenues. We forecast 100 bps QoQ increase in EBIT margin to 15.8% given the reversal of furloughs, and lack of one-offs which were seen in Q3. Key will be management commentary amid tariff tantrums.

Coforge: We expect ~3% growth on QoQ basis on revenues front, aided by ramp-up of multiple deals won in earlier quarters. We expect 60 bps QoQ increase in EBIT margin to 12.4%, given the operating leverage and absorption of wage hike.  Key monitorable would be growth outlook commentary, as it has witnessed healthy order inflows in last couple of quarters.

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