Nasscom, the Indian information technology services industry body, today indicated FY14 would be a better year than the previous year.
It expects revenues from exporting solutions, products and services to reach $84-87 billion, representing growth of 12-14 per cent. Domestic revenues are expected to grow by 13-15 per cent and reach Rs 1,18,000-1,20,000 crore. The 12-14 per cent growth will mean an addition of $12-15 billion revenue in FY14.
The 12-14 per cent growth rate is better than FY13, in that export revenues are expected to grow by 10.2 per cent and touch $75.8 billion. On constant currency basis, the industry witnessed a growth of 10.9 per cent, barely meeting its revised guidance. The domestic market continue to grow at a faster pace and is expected to have a growth rate of 14.1 per cent.
Nasscom had guided for a growth rate of 11-14 per cent for FY13, and the industry was expected to meet the lower end of growth guidance.
"We did revise the guidance and said it will be towards the lower end of the estimate. And we have managed to meet it. But the exit rate for most of the companies has been better than the last year. The qualitative comments and analyst feedback also hints towards a better 2014. I do believe that at this point of time we have a better visibility into the spend budgets than same time last year," said N Chandrasekaran, chairman, Nasscom.
Despite the challenges in FY13, the Indian IT industry consisting of IT services, BPM, engineering, research and development and software products and hardware, will cross the $100 billion mark.
Nasscom's prediction for a better year is also reflected in the commentary and guidance of some of the companies. For instance, Tata Consultancy Services (TCS) continued to report strong numbers, Infosys upped its guidance for FY13, and Cognizant guided for a 17 per cent for CY13.
Add to this, most of the companies said that discretionary spends is coming back.
Going ahead, some of the key growth drivers that are expected to open new opportunities for the industry are smart computing, anything'-as-a-service, technology enablement in emerging verticals and the small and medium enterprises (SME) market.
"Technology can also play a critical role in enabling transformation in India and add to India's GDP. The domestic market in India is maturing, it was the fastest growing market in the year and Nasscom will look to partner with the government in enhancing technology adoption in the country", said Som Mittal, President, Nasscom.