IT largecaps may be heading back to long-term trend line growth of 7-9%: Ankur Rudra, JP Morgan

The industry's revenues have regained the figures lost in FY21, and the slowdown in growth over the past year is not necessarily a cyclical issue but more a return to trend line growth..

Our recent analysis has suggested that the revenues lost by the industry in FY21 were largely won back in FY22 and FY23 and we are back to where it would have been, had the industry kept growing at that trend line rate..

This is probably more of a heading back to the trend line growth as opposed to necessarily only a cyclical impact on the industry, says Ankur Rudra, Head of APAC Telecoms & India TMT Research, JPMorgan..

And if we really zoom out of the recent weakness in prints and just analyse the trajectory of overall spending, it appears that the large IT companies in India as a whole have probably been heading back to the long-term trend line growth of 7-9%...

Multiple risks, for example, still stay above long-term pre-Covid levels and the challenge is that growth is heading back to the long-term trend line, like I said..

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