The sustained pressure on margin, along with Gartner’s recent note highlighting lower global information technology (IT) spending going ahead underline the growth pressure for domestic software players and potential risk of earnings downgrade. Of late, post the June quarter (Q1) results, many analysts have cut their FY20 earnings estimates for Tata Consultancy Services (TCS) by 2-3 per cent due to the above-mentioned concerns.

Some like Elara Capital also changed the ratings downward from Buy to Accumulate for TCS. Though demand pressure is palpable for the past one or two ...........................BS