Q1 FY27 Preview • IT Services

IT Sector Q1 Results Preview: EBIT Growth

QoQ EBIT Margin Change — Companies with Disclosed Estimates

Basis points (bps) change in EBIT margin, quarter-on-quarter

Directional Margin Calls — Tier-1

Choice Institutional Equities & Emkay Global
↑
Tech Mahindra
+25 bps, best performer
↑
LTIMindtree
+10 bps, FX aided
↑
Infosys
Expansion expected
↑
HCLTech
Expansion expected
↓
TCS
Wage hike drag
↓
Wipro
Wage hike drag

Mid-cap Margin Range

QoQ fluctuation, ex-BSOFT
-100 bps +40 bps
BSOFT: -310 bps (one-offs absent)

Key Margin Drivers

Tailwinds

AI-led internal productivity gains, favourable INR depreciation, and ongoing cost optimization initiatives.

Headwinds

Wage revisions at TCS, Wipro, LTIMindtree and eClerx; continued investment in AI capabilities; business seasonality and M&A-related costs.

Tech Mahindra: delivery efficiency + Project Fortius Net hiring likely to stay muted