IT Sector Q2 Preview: Demand Sluggish, BFSI Momentum Offers Some Hope

The mood across the IT sector remains cautious as demand weakness continues to linger. However, the broader macro environment has not worsened further, offering some stability after a few muted quarters.

Accenture’s latest commentary hints at positive traction in the BFSI segment, a theme that could have benefitted Indian IT firms during the second quarter of this fiscal.

A weaker rupee is expected to cushion some of the pricing pressure, while management commentary around client sentiment and H-1B visa changes will be closely watched as they shape hiring and delivery models for the months ahead.

Among Tier-1 IT companies, the focus is likely to remain on margin management and deal ramp-ups along with guidance outlook.

For Tata Consultancy Services, updates on the BSNL deal, JLR cyber-attack, and hiring plans will drive the narrative, though no major change in guidance is expected. Infosys and HCL Technologies are seen maintaining steady momentum.

Tech Mahindra could stand out in the September quarter, as its margin expansion plans under Project Fortius start to show, while Wipro’s commentary on Q3 revenue guidance will be key as the company seeks to regain growth visibility.

In the Tier-2 basket, performance is expected to be uneven. Coforge is likely to see benefit from margin expansion linked to the Sabre deal, while Persistent Systems is expected to deliver healthy growth on the back of BFSI and hi-tech verticals.

Mphasis could see some pressure from deal ramp-ups, and KPIT may experience delays in deal conversion as global auto clients pause projects.

While demand headwinds persist, margin resilience and BFSI recovery offer some optimism for the sector. With the rupee weakness providing near-term support, much of the Street’s attention this quarter will be on management commentary, especially around client budgets, pricing environment, and the pace of deal closures as the industry looks to set the tone for the second half of FY26.