At least 20 to 25 strong clients of technology consultant LTIMindtree are currently facing some amount of budget stress, though no financial impacts have been seen so far with respect to its business, according to LTIMindtree's Chief Financial Officer Vinit Teredesai.
“Out of our 700 plus clients, 20-25 are probably having certain amount of budget stress at this point of time. But there is no impact the company is seeing at this point of time with respect to budget cuts," he said in his first media interview since listing of the merged entity on 5th December.
There is a general sense of cautiousness on the IT budget, so everybody is watching the space. “But we are not seeing any reductions or cuts that are coming our way that are significantly impacting our plans as far as the calendar year 2023 is concerned,” he said.
Regarding the quarter three furloughs, he said they are not unusual. However, it is not something that is significantly damaging the growth trajectory of the company. On quarter on quarter (QoQ) as well as on year on year (YoY) basis, the management anticipates a decent and industry leading growth.
“As far as our full year target for FY23 is concerned, we still believe we are on track to achieve the industry leading profitable growth,” Teredesai said.
He does see furloughs in some pockets of the industry but not across all the companies or sectors. “It is specifically into BFSI sector,” he said.
On an overall note, the company is doing reasonable growth in quarter three and quarter four.
Travel vertical of LTIMindtree remains very strong. Healthcare segment is also doing very well. So the company is confident that it is not a structural change that is happening, it is only a cyclical impact that has been seen at this point of time.
However, the company is anticipating a 100 basis points (bps) impact on margins due to a one-off cost.
LTIMindtree also doesn't see any major changes in the hiring trends. “We want to assess the overall demand. We don’t want to overhire but there is no change as far as our hiring plans are concerned and we will continue to hire,” he mentioned.
When asked if any acquisitions are on the anvil for FY24, he responded saying that the company always continue to evaluate the opportunities available in the space.
For the full interview, watch the accompanying video
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(Edited by : CH Unnikrishnan)
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