IT , 4 || Indian IT sector set for quick recovery ||
ndian IT services companies, which receive most of their revenues from the US and Europe, may see a recovery faster than other sectors as spending picks up by clients pushing for enhanced digital play and taking advantage of the benign credit conditions in developed markets.
A few top-tier IT services companies and analysts told BusinessLine that while customers had embarked on digital transformation journeys at varying speeds in the past, Covid-19 has accelerated the process significantly. The current crisis is largely perceived to be worse than the 2008 global financial turmoil, but industry watchers believe that IT spend in 2020 will hold up, comparable to 2019 levels.
The US announced a $2-trillion package in March 2020 and followed it up with an additional $480-billion stimulus in April. Another round of stimulus is now under consideration by US Congress.
Pai said one of the reasons for higher liquidity in the market was the quick and unprecedented whatever-it-takes monetary and fiscal actions in the US and Europe that likely eliminated tail risks to economic recovery and reduced risk aversion among corporates.
Based on commentary from customers, software companies and IT services vendors, we believe that digital demand has been pulled forward from the future. We even had customers extending advances to vendors. The cheer was more widespread than anticipated, Pai said in a note to investors.
Mahesh Babu, an analyst with Centrum Broking, said that the situation was not as bad as was expected to be. We expected a much larger decline. Overall, there is a low-interest-rate environment in the US and elsewhere. There is a lot of liquidity in the market and that is one of the major reasons for interest here, Babu said.
https://www.thehindubusinessline.com/info-tech/it-firms-set-for-quick-recovery-as-tech-spend-picks-up-in-us-europe/article32564938.ece#:~:text=Indian%20IT%20services%20companies%2C%20which,credit%20conditions%20in%20developed%20markets.
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IT , 4 || Indian IT sector set for quick recovery || ndian IT services companies, which receive most of their revenues from the US and Europe, may see a recovery faster than other sectors as spending picks up by clients pushing for enhanced digital play and taking advantage of the benign credit conditions in developed markets. A few top-tier IT services companies and analysts told BusinessLine that while customers had embarked on digital transformation journeys at varying speeds in the past, Covid-19 has accelerated the process significantly. The current crisis is largely perceived to be worse than the 2008 global financial turmoil, but industry watchers believe that IT spend in 2020 will hold up, comparable to 2019 levels. The US announced a $2-trillion package in March 2020 and followed it up with an additional $480-billion stimulus in April. Another round of stimulus is now under consideration by US Congress. Pai said one of the reasons for higher liquidity in the market was the quick and unprecedented whatever-it-takes monetary and fiscal actions in the US and Europe that likely eliminated tail risks to economic recovery and reduced risk aversion among corporates. Based on commentary from customers, software companies and IT services vendors, we believe that digital demand has been pulled forward from the future. We even had customers extending advances to vendors. The cheer was more widespread than anticipated, Pai said in a note to investors. Mahesh Babu, an analyst with Centrum Broking, said that the situation was not as bad as was expected to be. We expected a much larger decline. Overall, there is a low-interest-rate environment in the US and elsewhere. There is a lot of liquidity in the market and that is one of the major reasons for interest here, Babu said. https://www.thehindubusinessline.com/info-tech/it-firms-set-for-quick-recovery-as-tech-spend-picks-up-in-us-europe/article32564938.ece#:~:text=Indian%20IT%20services%20companies%2C%20which,credit%20conditions%20in%20developed%20markets.