Analysts believe that big IT firms such as TCS, Infosys and Wipro may announce strong earnings for the July- September quarter, says an Economic Times report. Steep decline of the rupee against the US dollar and improved demand for outsourcing services seems to be the reason behind this forecast. The report added that analysts also expect strong volume growth for companies, supported by the improving demand scenario.

The report quoted Kotak Securities Head of Private Client Group Research Dipen Shah as saying, ”Volumes for the top 4 companies are expected to rise by 2.5-4 per cent, organically. Margins are expected to improve quarter-on-quarter, largely on the back of rupee depreciation. This is despite salary increments (in select cases).”

TCS is expected to lead the tier-I pack with 4.3 per cent Q-o-Q dollar revenue growth, while Infosys is also likely to see a good quarter with 4.1 per cent Q-o-Q revenue growth, Kotak Institutional Equities said in its quarterly technology report.

Read the complete report here