Nasscom stops guiding annual IT growth; cautiously optimistic for FY20

Indian IT industry lobby body Nasscom has decided to stop giving its annual revenue growth guidance for the IT-BPM industry, and will now be sharing indicative trends for what the industry could look at the next year instead. The need for this change, according to Nasscom, is to make the data and trends more relevant, keeping up with the changing macro factors and technology shifts in the industry rather than a number that does not envisage these ongoing changes.

Speaking at a press conference at the Nasscom Leadership & Technology Forum 2019, Debajani Ghosh, President, Nasscom said, "If we look at the overall indicators it was a pretty good year." Nasscom had earlier guided a 7-9 per cent revenue growth for IT services in constant currency terms for the industry for 2018-19.

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"What we have ended with is the export growth at 9.2 per cent, and the domestic revenues have grown by 7.9 per cent," she added. In FY19 the IT software and services revenues growth crossed $165 billion, with the overall IT exports growing to $137 billion compared to $126 billion in FY18, and domestic revenues growing to $44 billion from per cent $41 billion in FY18. Reflecting on the growth, Rishad Premji, Chairman, Nasscom said, "During the year, the industry performance also showcased a changing narrative for the sector, a sector that focuses on internal transformation and driving transformation for its clients globally and in India". While the annual guidance has been done away with, Nasscom shared its first ever CEO survey of 100 CEOs to indicate the larger emerging trends.

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According to the survey, while 47 per cent believe that CY2019 could be somewhat better than 2018, overall 51 per cent believe that growth could be muted. Recently, several research reports sounded cautious in their outlook for the IT sector and now with Nasscom echoing the sentiment, many experts believe the industry could be looking at similar growth rates of 8-9 per cent for FY20. The increased caution of course comes on the back of several emerging challenges such as increased protectionism, currency fluctuations, weakening financial market sentiment and regulatory changes in the tech technologies. However, most CEOs believe the growth pockets for FY20 could be around large deals for digitisation and increased discretionary spending on technology.