Indian it services sector is the most preferred investment theme am In June, 21% of fund manners chose the sector as their top pick, up from 13% in May. The Survey Findings were followed by results from global it Major accounture, which is widely seen as a bather for Indian tier-1 it firms.
Accenture, which follows a September-August Financial Year, Reported 7% Year-On-Year Constant Currency Revenue Growth in the Quarter Ended May (Q3Fy25), Beating COMING COMINTESUNSUTES and Coming in A The upper end of its guidance range.
A Motilal Oswal Financial Services Report Dated 20 June Said That The Impact of a Tariff-Related Pause was Milder Than Earlier Feared for Accenture. This, it said, was also corroborated by the rebound in Indian it stocks over the past two months.
The nifty it index has rebounded to 38,408 after slumping to a 52-wheek low of 32,517 on 7 April, AMID Sharma Selling triggered by the US tariff announs on 2 April. With Indian Tech Firms Heavily Expeded to the US Market, Fears of a Tariff-Dr. Such a Downturn Could Dampen Deal Wins and Derail Hopes of a Revenue Revival in FY26.
That said, accenture raised the lower end of its fY25 Constant Currency Revenue Growth Guidance (with one Quarter Remining) to 6-7% from 5-7% earLier. While Global Uncertainty Remains Elevated Compared to 2024, The Q4Fy25 Pipeline Remains Strong, Accenture Management Said. Clients Continue to Prioritize Digital Transformation, Gen AI (Generative Artificial Intelligence) Adoption, and Enterprise-with cost efficiency, but disacrete it is still mutdends are still muteds. Overall, The Demand trends have been larger stable, it added.
“An unchanged demand environment can protect current fY26 Revenue Growth Assumptions for Indian It and Perhaps Lead to UPSides for a less. 3.5-4.5%, excluding the impact on the federal business as a positive in this regard, “said a kotak institutional equities report dated 21 June. On the other hand, a mutated deal-win Scenario will create headwinds for growth in 2hfy26 and 1hfy27, it added.
Accenture’s Deal Bookings in Both Consulting and Managed Services (Outsourcing) Fell year-or-Year in Q3Fy25. Accenture Compets with Large Indian It Companies in the Managed Services Business, where deal bookings declined for the third Consective Quarter and by a Sharp 10% Year-Once-Year in Q3Fy25. Plus, The Pace of Revenue Growth Esed after TwosuCcessive Quarters of Double-Digit Growth.
This does not bode well for Indian companies giving
According to BNP Paribas Securities India, Deal-WIN Announcements in May WERE TAD LOWER MONTH-On-Mayth after a decline in April. Tata Consultancy Services Ltd and Infosys LED the Deal Wins in May with Four Deals Each Followed by Wipro Ltd. But bnp cautions that Ongoing Global Macroeconomic Uncertainty Will Keep Deal Momentum Slow in Coming Months.
“The three-month rolling sum of deal signings, a strong one -Quarter lead indicator of deal total contract value, declined further,” it said in a report on 4 june.
Despite the recent rebound, the nifty it index is down 11% in 2025 so far. Accenture’s Q3Fy25 Had Some Positives, but it is best not to extrapolate them for Indian it stocks where valuations are a sore spot too. The nifty it index trades at a one-year forward price-to-earnings Multiple of 26x, Premium to its long-term average of 21x, as per bloomberg data.
A re-rating for the sector depends on a New Technology Cycle Emerging, Client Spends Moving from ‘Run-The-Business’ Spends to ‘Change-to-Busines’ Spends and Mending UPGRANINGS, Added Motule Oswal report.