Rupee depreciation along with strong volume growth will see IT companies posting better numbers this quarter, say analysts.
“Q2-FY12 performance, though operationally strong, is likely to be influenced by cross currency movements as well as the sharp INR movement. We expect tier-I companies to report strong volume growth of 4-6 per cent q-o-q, with TCS expected to report the highest surge,” said an IT research report by Edelweiss Capital.
Margins, though, aided by INR's depreciation, are likely to be impacted by campus hiring, promotions and salary hikes, said the report. Infosys will have to cut its USD revenue growth guidance two per cent for FY12 due to cross currency movements, though it could revise its INR earnings guidance up 6-8 per cent, the report said.