IT margins to remain under stress till 2020 as competition is high: Icra

Price led competition and chasing limited new opportunities will impact business

Indian IT services firms will see margins reduced in the next two years as they face the challenge of increased competition for deals, growing automation and the limited number of newer opportunities. These firms will see margins drop to as low as 21.2 per cent by 2020, says a new report by Icra.

The industry’s operating margins have moderated from 24-25 per cent to 23-24 per cent over the last few quarters and despite higher efficiency and automation margins will decline from 23.5 per cent in FY2017 to 21.2 per cent in FY2020 estimates said the report.

“While companies have